Beginning January 1, 2011 the laws about 1099s will change. You know about 1099s. They’re that series of forms the IRS uses to collect information about income that otherwise might not be reported. For most retailers, that means reporting payments to independent contractors if they make over $600. It’s about to mean much more.
In a bad economy, governments are stressed for money. We’re seeing governments at all levels trying to increase tax revenues without actually raising taxes. The federal government is no exception. The IRS estimates that the federal government loses $300 billion a year because of income that is never reported and taxes that are never paid.
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Justin Swanström is a member of the COVR Board, a practicing attorney, and co-owner of Shining Lotus Metaphysical Bookstore in Denver, Colorado. www.shininglotus.com