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I just saw the reply to one of my 2 questions, but I was…

Customer Question
I just saw the...

I just saw the reply to one of my 2 questions, but I was trying to find the backup in the code It is related to catering

Accountant's Assistant: The Accountant will know how to help. Please tell me more, so we can help you best.

So if you are just purchasing the food from the restaurant, but the restaurant is not serving it, then no 1099 required, since no service is provided? Where could I find that in the code?

Accountant's Assistant: Is there anything else the Accountant should be aware of?

SO if the food and service charges are not broken out on the invoice, then include it all?

Submitted: 7 months ago.Category: Tax
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12/7/2017
Tax Professional: Lane, JD, CFP, MBA, CRPS replied 7 months ago
Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 14,643
Experience: Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
Verified

Hi. My name's Lane

I hold a law degree (J.D.), with concentration in Tax Law, Estate law & Corporate law, an MBA in finance, a BBA, and CFP & CRPS (Chartered Retirement Plans Specialist) designations, as well - I’ve been providing financial, Social Security/Medicare, estate, corporate, non-profit, and tax advice 1986.

I tried top look for another question on the site to try to understand the context here, but there's on;y this one question under your user name. Can you possibly give me more detail? Is this about any requirement to send a 1099-MISC?

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Customer reply replied 7 months ago
Hi Lane,Yes, the question was about the requirement to send a 1099 if food is being delivered to the business and not served?
Tax Professional: Lane, JD, CFP, MBA, CRPS replied 7 months ago

And you are the caterer?

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Customer reply replied 7 months ago
also, would all charges, food and service, be included on the 1099, right? I know, this is assuming the restaurant is NOT a corporation.
Customer reply replied 7 months ago
No, the business buying the food. :)
Tax Professional: Lane, JD, CFP, MBA, CRPS replied 7 months ago

OK so you're the business BUYING the catering/food delivery?

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Customer reply replied 7 months ago
the possible ISSUER of the 1099
Tax Professional: Lane, JD, CFP, MBA, CRPS replied 7 months ago

Yep, give me just a sec ... I want to pull up the regs

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Tax Professional: Lane, JD, CFP, MBA, CRPS replied 7 months ago

Yes, if this is something you'll deduct as a business expense and not simply a personal issue AND (as you've mentioned) the company is not a corporation, AND you're over the $600 threshold, you'll need to send the 1099-MISC.

...

Where you see this in terms of IRS guidance is in the instructions for the 1099-MISC

...
I'll paste the pertinent part: (the underlining is mine)

...

"File Form 1099-MISC, Miscellaneous Income, for each person in the course of your business to whom you have paid during the year:

  • At least $10 in royalties (see the instructions for box 2) or broker payments in lieu of dividends or tax-exempt interest (see the instructions for box 8);

  • At least $600 in:

    1. Rents (box 1);

    2. Services performed by someone who is not your employee (including parts and materials), box 7; ..."

...

And there are more but here the caterer is a service provider to your business.

(https://www.irs.gov/instructions/i1099msc)

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Customer reply replied 7 months ago
ok
Tax Professional: Lane, JD, CFP, MBA, CRPS replied 7 months ago

The only place you'll see this in the code itself is in §162 ... that ordinary and necessary business expenses are deductible (the courts have long since been settled that an expense need not be indefensible, but simply "helpful to your business.")

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Tax Professional: Lane, JD, CFP, MBA, CRPS replied 7 months ago

SO if this was to cater a business retreat, business luncheon on site, etc... (for employees), it's deductible and you need to provide the 1099

...

If this was to provide food at a marketing event it's fully deductible as advertising

...

If this was lunch to discuss business it's falls into the 50% M&E that's 50% deductible.

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Tax Professional: Lane, JD, CFP, MBA, CRPS replied 7 months ago

But yes, certainly a 1099-Misc is required if over $600 to the entity in the tax year.

...

Please let me know if you have ANY questions at all, before rating me.

If this has helped, and you DON’T have other questions … I'd appreciate a positive rating, using the stars on your screen, and then clicking “submit" – That’s the only way I’ll be credited for the work.

I hope you’ll rate me based on my accuracy and thoroughness (as opposed to any good news/bad news content). Thank you!

...

But again, if you need more on this, please let me know.

Lane

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Customer reply replied 7 months ago
Are you still there?
Tax Professional: Lane, JD, CFP, MBA, CRPS replied 7 months ago

Yes

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Tax Professional: Lane, JD, CFP, MBA, CRPS replied 7 months ago

How else can I help?

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Tax Professional: Lane, JD, CFP, MBA, CRPS replied 7 months ago

Hi, Lane here.

...

I’m just checking back in to see how things are going.

...

Did my answer help?

If so, I'd appreciate a positive rating, using the stars on your screen, and then clicking “submit" – That’s the only way I’ll be credited for the work.

But if you need more on this please let me know

Lane

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