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Understanding IRS 1099-K for Transportation Companies

Learn about the new normal in tax reporting for transportation companies and independent contractor drivers. Understand the important dates and requirements for filing 1099-K forms. Avoid backlogging and withholding issues by obtaining completed Form W-9 from drivers. Ensure accurate reporting of all payments, including non-cash business and credit card transactions.

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Understanding IRS 1099-K for Transportation Companies

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  1. 1099 -K the new normal…

  2. The Parties • Bank or Processor • Aggregate Payee • transportation company • Independent Contractor • Drivers • IRS

  3. Important Dates • January 1, 2011 • Companies begin to accumulate W-9’s • January 2012 • Bank or payment processors will • issue a gross transaction form • to the transportation company aka • aggregator. This will be the total • of all charges paid to the Independent • Contractor drivers. • January 31, 2012 • Deadline for company to distribute • 1099-K copy “B” to its Independent • Contractor payees. • February 28, 2012 • Deadline for company to file 1099-K • part “A” to the IRS.

  4. Details • No minimum amounts or trip • counts. • Banks and processors must inform • aggregators of 2011 totals during • the month of January 2012. • Amount reported is the total amount • charged to customer not the redeemed • amount paid to driver. Driver will • account for his processing cost on his • tax filing. • A completed Form W-9 must be • obtained from each driver for • aggregator to avoid back up • withholding rules. • Employee drivers are exempted.

  5. Included Services • Payments to drivers of all other Non-Cash • business such as voucher income must be • reported. • Payments by drivers or customers by • credit card must be reported • Income from private label and gift cards • must be reported.

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