Pinetop White Mountain Blog

Good Morning Everyone,

I found something on the National Association of REALTORS® website this morning that will be of particular interest to Landlords.  There has been a change in the Tax Law that you should know about whether you are a Property Manager or a Private Individual who handles your own rental properties. 

Starting in January 2011 you will be required to obtain Federal Tax Identifcation numbers for any Contractors who conduct more than $600 of work on your properties.  You will be required to supply a 1099 to them at the end of the year.  Read below for the details and a link to the History of the Law. 

December “Did You Know?”

New IRS 1099 Requirements for Landlords

Starting in 2011, there is a new tax requirements for landlords. All landlords who receive $600 or more in rent for the year must send a 1099 to all service providers that the landlord paid $600 or more during the year, such as plumbers, carpenters, yard services, and repair people.

The new requirement applies to owners of both residential and commercial property. Prior to 2011, this requirement had only applied to those involved in full-time property management, but now the requirement covers all types of landlords. Landlords will need to gather federal tax ID numbers from service providers in order to file the 1099s. Failure to file the 1099s with the IRS can result in fines of $50 per 1099 not filed with the IRS. In 2012, these requirements will expand to cover providers of good to landlords.

NAR actively opposed this change in the law and is working with others to have this requirement repealed or otherwise modified. Congress took this action in order to assure that income paid to contractors can be verified through a section 1099. To read more about the history of the law as well as the actions NAR has taken to oppose this change in the law, click here.

This information is provided by the National Association of REALTORS® and has been copied in full from their website.

Thought you might like to know.

Sandra Paulow, Associate Broker, GRI, SFR  (928) 242-0300

Your High Country Connection for Real Estate.