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Common misconceptions about filing 1099s
Mercury explains 1099-NEC filing rules, including the $600 payment threshold and deadlines, to help small businesses avoid IRS penalties and misclassification risks.
- Mercury published a guide clarifying 1099 rules for founders, urging early planning for tax season and highlighting the Jan. 31 Form 1099‑NEC filing and furnishing deadline.
- Confusion stems from dense IRS guidance and shifting rules, causing founders and small business owners to struggle with 1099s amid conflicting online advice and misconceptions about 'full-time' contractors.
- Businesses must file Form 1099‑NEC when paying independent contractors, freelancers, or self‑employed individuals $600 or more, or if three $250 payments are made, tracking all vendor totals.
- Misfiling or late filing can trigger IRS penalties and audits, with misclassification causing back taxes, legal disputes, and reputational damage for founders and small business owners.
- To prevent problems, set December reminders and run year‑end vendor reports to reconcile totals, use accounting tools, and consult a qualified tax professional since Mercury does not provide tax advice.
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24 Articles
24 Articles
Coverage Details
Total News Sources24
Leaning Left2Leaning Right1Center19Last UpdatedBias Distribution86% Center
Bias Distribution
- 86% of the sources are Center
86% Center
C 86%
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