I do bookkeeping for Real Estate office. we rent space from a broker who also shares his building with us. We are a separate company. Every time we close a real estate deal he receives a commission of 10% ( which even though I wasn't told is in lieu of rent). My boss is wondering why I did not give him a 1099. I took over a job my predecessor did not do a 1099 for him either. My understanding is that to 1099 someone they have to provide a service for us and not be an employee. We spoke to our CPA office who have to figure it out and give us a call back. For the sake of understanding and knowledge I would like to know whether we were right and not giving him a 1099
USA 1099 question regarding broker in real estate
- Thread starter Jordan59
- Start date
1099 is required for rent or service over $600. If he is taking a share of the commissions whether or not in lieu of rent, and you are taking a deduction for the same, a 1099 is required. The only question is does it get reported as rent or non-employee comp.
If your CPA needs to research this, find a new CPA.
If your CPA needs to research this, find a new CPA.