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I had some work done to my house and the insurance company…

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I had some work...

I had some work done to my house and the insurance company sent the remaining balance to mortgage company. They are requesting a w9 from the contractor. Why are they requesting this? If I did some of the work. Am I required to submit a w9 to

Accountant's Assistant: Because real estate law varies from place to place, can you tell me what state this is in?

Is this a tax question

Accountant's Assistant: Has anything been filed or reported?

No

Submitted: 8 months ago.Category: Tax
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11/13/2017
Tax Professional: Chad EA, CDFA®, CFP®, CERTIFIED FINANCIAL PLANNER ®, Professional replied 8 months ago
Chad EA, CDFA®, CFP®
Chad EA, CDFA®, CFP®, CERTIFIED FINANCIAL PLANNER ®, Professional
Category: Tax
Satisfied Customers: 2,630
Experience: IRS Licensed Enrolled Agent, CDFA ® CFP ®, MBA
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Welcome to JustAnswer. My name is ***** ***** I will be able to assist you today.

The IRS requires that the insurance company keep track of all their payments for business expenses for at least three years. The insurance company protects the insurance company and provides proof of payment, the W9 also prevents hiring workers who are not eligible to work in the US.

If you will be paid for the work you completed then you would have to claim the income that you are paid.

If you or the insurance company pay an independent contractors, you may have to file Form 1099-MISC, Miscellaneous Income, to report payments for services performed for your trade or business. If the following four conditions are met, you must generally report a payment as non employee compensation.

  1. You made the payment to someone who is not your employee;
  2. You made the payment for services in the course of your trade or business (including government agencies and nonprofit organizations);
  3. You made the payment to an individual, partnership, estate, or in some cases, a corporation; and
  4. You made payments to the payee of at least $600 during the year.
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Tax Professional: Chad EA, CDFA®, CFP®, CERTIFIED FINANCIAL PLANNER ®, Professional replied 8 months ago

Income received from an insurance company that is not accounted for by repairs cost, maintenance or replacement cost for example, would be taxable income

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Tax Professional: Chad EA, CDFA®, CFP®, CERTIFIED FINANCIAL PLANNER ®, Professional replied 8 months ago

Casualty, disaster and thefts are covered under IRS Publication 547.

https://www.irs.gov/pub/irs-pdf/p547.pdf

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Tax Professional: Chad EA, CDFA®, CFP®, CERTIFIED FINANCIAL PLANNER ®, Professional replied 8 months ago

How To Report Gains and Losses

ow you report gains and losses depends on whether the property was business, income­producing, or personal­use property. Personal-use property.

If you have a loss, use both of the following. Form 4684, Casualties and Thefts. Schedule A (Form 1040), Itemized Deductions (or Form 1040NR, Schedule A, if you are a nonresident alien).

If you have a gain, report it on both of the following. Form 4684, Casualties and Thefts. Schedule D (Form 1040), Capital Gains and Losses.

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Tax Professional: Chad EA, CDFA®, CFP®, CERTIFIED FINANCIAL PLANNER ®, Professional replied 8 months ago

I would be happy to answer any follow up questions you may have.

At the conclusion of our conversation please take a moment to accept the answer by rating the answer with three stars or more.

A positive rating of five stars is always appreciated.

Thank you!

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Tax Professional: Chad EA, CDFA®, CFP®, CERTIFIED FINANCIAL PLANNER ®, Professional replied 8 months ago

I do want to add that before you decide if you have to claim the reimbursement as income, you should review publication 547 starting with page six which covers "Insurance and Other Reimbursements "

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