Do Individuals Have to Issue 1099s to People Who Repair Stuff on Their Home?

You don't have to provide a 1099 for a repairman in your home.

The Internal Revenue Services uses 1099s to track payments made to independent contractors and self-employed individuals. Businesses must issue 1099s to other businesses or individuals they hire to perform work for them. As an individual, you don't have to follow these same rules. The washing machine repairman, roofer or plumber you hire to repair stuff at your home isn't expecting anything from you come tax time.

Businesses and 1099s

The Internal Revenue Service requires businesses to send a 1099 to anyone to whom they paid $600 or more in fees, rentals, prize money or other cash payments. The 1099 must list the name of the business or person the money was paid to, the total amount paid during the year, and the Social Security number or tax identification number for the person or business. Most businesses require subcontractors and others for whom they anticipate filing a 1099 to provide a form W-9, which lists the business name and the tax identification number.

Self-employed Taxes

Self-employed repairmen and others who work for themselves are required to report all their income to the IRS, whether they receive a 1099 or not. A repairman whose clients are mostly other businesses might receive 1099s that closely match his actual income, but someone who works with many private clients, such as a residential plumber or handyman, would receive very few and perhaps no 1099s.

Household Employees

If instead of hiring a self-employed person to fix things around your home you decide to hire your own maintenance man, you could be required to pay taxes for this person, who would be considered your employee if you set the person's hours, dictate his duties and how the duties should be done. For instance, if you hire Joe's Plumbing to install a new toilet, Joe decides when to show up, how long to take to do the job and what materials to use. If you hire Joe as your handyman, instruct him to install the toilet at 9 a.m. and provide him with the materials to use, the IRS considers Joe to be your employee. You may need to pay the employer's share of Social Security and Medicare taxes, as well as unemployment taxes, for any employees. However, this would not require a 1099.

Other Considerations

If you're self-employed and operate a business in your home, whether or not you need to send a 1099 to a contractor depends on the job they do and whether the repair benefited your business or your home. Computer repair or wiring your office phone lines are business expenses and require a 1099. Painting your living room isn't a business expense and doesn't require a 1099. If you paid for the work out of your business account, it requires a 1099. If the amount you paid to the repairman was less than $600, you don't have to send a 1099 regardless of whether it was a business or personal expense.

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