IRS Form 1099-MISC

The University is required to file Form 1099-MISC, Miscellaneous Income, for calendar year payments made for (1) at least $10.00 in royalties, or (2) at least $600.00 in rents, services (including parts & materials), prizes and awards, other income payments, medical/ health care payments and legal services. 

The University‘s reportable payments include:

  • Rents:
    • Machine rentals
    • Pasture rentals
    • Real estate rentals paid for office space unless paid to a real estate agent
  • Royalties:
    • Industrial
    • Literary
    • Patent
  • Other income: This category is for other income required to be reported on Form 1099-MISC that is not reportable in one of the other boxes on the form.
    • Prizes and awards that are not for services performed. (Include the fair market value of merchandise won if given in lieu of a cash award.)
    • Blood donors
    • Research subjects
    • Compensatory damages
  • Medical and health care payments:
    • Physician and other supplier/provider of medical or health care services.
      • If the provider is part of a corporation, list the corporation as the recipient instead of the individual.
        • Use the corporation’s Tax Identification Number and not the individual’s SSN.
      • Corporations are not excluded for medical/health care services. This income is reportable.
    • Medical transcriptions are not medical services, but are reportable under “Non-employee compensation.”
  • Non-employee compensation:
    • Includes fees for services performed, or other forms of compensation for services performed for the University by an individual who is not a University employee. If payment includes reimbursement for expenses, only the fees for services are reportable. Non-employee compensation payments require their home or business address. The requesting University departmental address is not sufficient. If the following four conditions are met, a payment generally is reportable as non-employee compensation:
      • the payment was made to someone who is not a University employee
      • the payment was made for services in the course of the University’s trade or business
      • the payment was made to someone other than a corporation, e.g., an individual or a partnership
      • payments were made to the payee of at least $600.00 during the “calendar” year
    • Examples of payments reported under Non-employee compensation are:
      • Professional service fees such as to attorneys, accountants, and architects
      • Payment for services, including parts or materials used to perform the services if supplying the parts or materials was incidental to providing the service
      • Payments to non-employee entertainers for services
      • Honorariums
      • Guest Lecturers
      • Independent Contractors
      • Legal Fees

Reimbursement payments to any of the above are reportable as Non-employee compensation when receipts or documentation is not provided.

Exceptions to 1099 Reporting

The IRS does not require some payments to be reported on 1099-misc forms although they may be taxable to the recipient. These include: 

  • payments to a corporation (with the exception of medical/health care and legal fees)
  • payments for merchandise
  • payments of rent to real estate agents
  • wages paid to employees (report on form W-2)
  • Educational/Research Traineeship Grants