3525 Schools from 112 Districts... Can't be Wrong!
How does IRS Form 1099 Apply to Schools
The Internal Revenue Service requires that individuals with whom you contract for a service, with an agregate total in excess of $600, be issued a 1099 Form no later than January 31 following the calendar year during which the payments were made. Failure to issue the required Form 1099 for an applicable company or individual may result in the school being liable for a penalty. (IRS-1099 Information)
District Wide Issues Relating to IRS Form 1099
When a distirict pays a fee for services rendered at an individual school the district is then responsible for tracking 1099 eligibility for the vendor in question. For example, on separate occasions a local magician has entertained 10 schools and charged each school $100. Alone each $100 payment is below the $600 threshold but when combined these payments exceed $600. The district must now issue a Form 1099 for the magician.
Another example would be where a referee is hired for 7 tournements throughout the year. The referee's fee is $100/tournement. In agregate the referee has been paid by the school more than the $600 threshold. Unfortunately many schools are not equipment to deal with this reporting requirement which exposes the School and District to penalities.
SchoolCash.NET and IRS-1099 Reporting
As a district wide web based solution SchoolCash.NET simplifies the reporting of IRS-1099 eligible vendors. By tracking the vendors Federal ID number (Social Security) at the time the expense is entered SchoolCash.NET can produce an IRS-1099 report for a given date range.
IRS-1099 Supporting Information:
KEV Software Inc. Tel: (800) 362-1756 info@kevsoftware.com