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1099

Discussion in 'Shooting Related Threads' started by trinketshooter, Jan 28, 2011.

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  1. trinketshooter

    trinketshooter TS Member

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    I got an e-mail from one of the clubs that I have been shooting at for a couple of years. They wanted me to provide my social security number for a 1099 form for my winnings at their club this year. Is this a normal thing? I shot at the same club last year and I didn't receive a request for my social security number last year. They are great people and I trust them, but I have not given my number out for a long time and I don't even give my social security number to my doctors office anymore. Does anyone have experience with this? Neil
     
  2. mixer

    mixer Well-Known Member

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    If you won more than $600 in 2010 at that club they are required to file a 1099 on you and you are required to supply your SS#. Of course you can refuse and then you can explain your reasons to the IRS buy I don't think you want to go there.

    Eric
     
  3. Dickgshot

    Dickgshot Well-Known Member

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    There is a penalty of $50 for failing to provide your social security number to a requester who is making payments to you.
     
  4. Dickgshot

    Dickgshot Well-Known Member

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    You're right, the IRS doesn't care about 1099's. That's why they have a penalty of up to $250 for failing to provide a 1099 to a payee. Then, of course, the IRS computer is programmed to look at your return for a 1099 submitted under your Social Security number. If it's not there, they send you a bill for the tax.


    As far as a writing off your expenses against the reported income: You can only claim a deduction for the amount of expenses equal to the income from that activity. The deduction is available only if you itemize your deductions on form 1040, Sch. A, and as a "miscellaneous itemized deduction." The total of your "miscellaneous itemize deductions" are reduced by 2% of your Adjusted Gross Income(basically the total that appears at the bottom of page 1 of your tax return.)


    If you got a 1099 for $602, and your total Adjusted Gross Income for the year was $30,000; and you had no other "miscellaneous itemized deductions,"
    you could offet $2 against that $602 of income. ($30,000 X .02= $600. $602-600=2)
    That means you pay tax on $600 of the $ 603. Sorry, but those are the rules.
     
  5. X Trap 2

    X Trap 2 TS Member

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    dickgtax

    So it does not matter how much one spends the deduction is the same?

    Wife got one (W2G)for $1500.00, the amount won, she or we pay tax on $1198.00? Ray

    Came back to edit.... We can offset the $1500.00 winnings with monies spent there that same year. She spent more than that so we should not have to pay any tax on the $1500.00. We could go on line and the computer keeps up with the winnings and losses as long as a card was used and swiped. Glad to find that out. I just printed a copy of the end of year total and will attach it to my tax information when I take it to my book keeper/tax preparer.

    My wife will now also keep records of monies spent that do not have the card swipe to keep track of it. Ray
     
  6. trinketshooter

    trinketshooter TS Member

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    I gave my ss# to avoid any problems. I am sure that I lost more than I won this year. Neil
     
  7. 221

    221 Banned User Banned TS Supporters

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    Get a "TIN"......Taxpayer Identification Number.......Solves the problem with giving out your SSN.

    There's a form that your club should keep on file where you state your TIN or SSN.......Some of the Accountants on here should be able to explain it, properly.

    Surely the ATA does this.....
     
  8. 870

    870 Well-Known Member

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    That "TIN" idea won't work. A social security number (SSN) is always a "TIN", but a "TIN" is not always a "SSN". For purposes of an individual and the number to provide on any request from a payor, you use your SSN. The "TIN" for a business that has an "EIN" is the "EIN". IN other words, the IRS does not issue something specifically called a TIN, that term just refers one of 4 different numbers that apply in different situations. For what we are talking about here, unless it's a business, the required number is the SSN. There is no special number an individual gets to use in place of their SSN.

    If you refuse to provide the info, there is a $50 penalty and the payor is required to withhold tax from all future payments to you. Actually, the fact they paid you without obtaining your number ahead of time is a problem, but one that happens all the time.
     
  9. Dahaub

    Dahaub Active Member

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    The one good thing about getting a 1099 for winning money is that when you report that winnings you also get to claim the deductions of cost of shells, use of your equipment, prices of entry's and mileage to and from so I think you will probably come out ahead of the game. :) Dan
     
  10. 870

    870 Well-Known Member

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    As far as a trapshooting site goes, sometimes the trapshooting advice here is questionable. As a tax site, we get some very bad advice.

    dickgtax is correct for most of us.
     
  11. shelly

    shelly TS Member

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    Twinky, I suggest you ask George Bush for tax advice since you love him so much.
     
  12. Allen-MX8

    Allen-MX8 Member

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    Much of the information previously submitted by some is really not correct!

    Among other things, the receipient of the money does not issue the 1099 but the payor of the money does.

    I could go on and on, but the best advice is to consult your local CPA or tax preparer!!

    Allen
     
  13. 221

    221 Banned User Banned TS Supporters

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    <EM>Taxpayer Identification Numbers (TIN)

    A Taxpayer Identification Number (TIN) is an identification number used by the Internal Revenue Service (IRS) in the administration of tax laws. It is issued either by the Social Security Administration (SSA) or by the IRS. A Social Security number (SSN) is issued by the SSA whereas all other TINs are issued by the IRS.


    Taxpayer Identification Numbers
    Social Security Number "SSN"
    Employer Identification Number "EIN"
    Individual Taxpayer Identification Number "ITIN"
    Taxpayer Identification Number for Pending U.S. Adoptions "ATIN"
    Preparer Taxpayer Identification Number "PTIN"</EM>





    Are you tax guys saying everyone in the US, that pays taxes, has a SSN?????
    I don't think so.

    That's the biggest problem with our tax laws,,,,,,every accountant has a different interpretation of the tax laws......just as bad as lawyers.
    You can ask 10 a question and get 11 different answers.

    I would say, if your going to accept prize monies and deduct expenses, I'd be getting a TIN, EIN, or whatever it's called this week.....I know individuals that have them......I for one, do. Many involved in motorsports have them. I have one because my accounting firm that handles my accounting advised me to do so.

    ALSO.....When did your, our, SSN's become an ID number?? Unless you are my employer, my SSN is none of your business.
     
  14. Allen-MX8

    Allen-MX8 Member

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    Rick Barker: Not meaning to get into an argument with you (or anyone else for that matter) but anyone can download and print all of the IRS Tax forms and I suppose complete the forms as well.

    But, the IRS Instructions for Form 1099-MISC specifically states, and I quote in part: "File Form 1099 MISC, Miscellaneous Income, for ech person to whom you have paid during the year: At least 600 in rents, services, prizes and awards,......"

    Check out the above link to the IRS publications or consult your own Tax Adviser.http://www.irs.gov/pub/irs-pdf/i1099msc.pdf

    Regards,
    Allen
     
  15. 870

    870 Well-Known Member

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    221:

    You have just posted the facts I was telling you about in my post. Read your second paragraph, it describes what TIN's are issued: SSN, EIN, ITIN, and ATIN. That's it, those 4 items are all the TIN's, you have to enter one of the 4 as is applicable. ITIN's are only for non-US citizens, and ATIN's are for adoptions, forget about those. The EIN is only applicable for a business, and an individual is required to use his SSN as his TIN in all other situations. IF you want the actual rules, check out Reg. 301.6109-1(a)(1)(ii) and it's subparts.

    That's all I'm telling you, there is no magic number here. You can't get a number that is actually called a TIN itself, it will either be a SSN or in the case of a business, an EIN. Well, I shouldn't say you can't, because you can do anything you want, it just might be contrary to the regs.

    Rick Barker:

    The issue you have confused is that you referenced a 1099, and that is not a form that you fill out and sign. Actually, a 1099 doesn't even have a space for a signature. I think you meant to refer to a W-9, that is the form the recipient fills out to certify his number and backup withholding status to a payer. Yes, you can carry those around with you already filled out, sign and turn them in whenever you like. What Allen was pointing out is that you don't do that with a 1099.
     
  16. halfmile

    halfmile Well-Known Member

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    Shooting expenses and/or gambling losses are only deductible to the amount of gain in these cases.

    The same goes for other activities the IRS considers "hobby businesses".

    I tried that with racing years ago and found out the hard way. Deduction denied.

    HM
     
  17. 870

    870 Well-Known Member

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    Rick:

    It is a lot more complicated than you think. If you are able to treat trapshooting as a business, all winnings go on Schedule C and all expenses including shells, entry fees option fees etc get shown on Sch C as well and you pay tax on the net profit, or deduct the net loss. This is the only available situation where you are allowed to net expenses directly against winnings before entering on page 1 of your return.

    Most of us can't treat it as a business. The choices are: consider option winnings gambling winnings, in which case the gross winnings get reported on line 21 of your 1040, and then IF YOU ITEMIZE, you can deduct your option fees (limited to the amount of the winnings), but probably not entry fees, shells, travel etc, as wagering expenses. If you don't itemize, all the winnings are fully taxable, with no offset for expenses at all. The only thing that can be netted directly against winnings reported on page 1 in this case is the cost of the WINNING options.

    Other choice: consider trapshooting a hobby. Income still gets reported gross on the other income line of your return. Expenses of trapshooting, including entry fees, shells, travel etc. are considered misc. itemized deductions, but limited to the amount of your gross winnings. In addition, those expenses which are already limited to the same amount as the income already reported on your return, get reduced a second time since misc itemized deductions are only allowed if they exceed 2% of your adjusted gross income. It is likely that most of your expenses will disappear by the time you get done going through these limitations, while at the same time the winnings remain taxable in full.

    Yes, this gets abused all the time, many CPA's apparently don't understand the hobby loss rules (from what I read on here at least), so YMMV.

    This is the way the Code and Regs treat the matter.
     
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