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If you pay someone $600 or more in your trade or business, which you do not have to be an LLC or a “company”, you are required to send them a 1099 if they are not incorporated. You are allowed to take the deductions if they are necessary and ordinary in your trade or business regardless of if you send them a 1099. The issue is the IRS has increased their penalties for not filing 1099s when you should have. The penalty currently is up to $100 per information return.
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