1099 Form To Lawyer

[AnthonyD2004]

So i applied for unemployment in 2020 as an independent contractor because i mowed lawns around my neighborhood for cash. I was 16 at the time and was looking for a job. Needless to say Unemployment is asking for all of their money back so i had to get a Lawyer to fight for my unemployment benefits. Do i have to issue that lawyer a 1099.  They said i don’t but i want to make sure. I paid the lawyer a total of 300$ but i’m supposed to be giving them another 300$ equaling 600$ and want to make sure i don’t have to send a 1099. Also the lawyer is self employed 

[AnthonyD2004]

Also i am not self employed anymore, I am just fighting for what i had gotten. 

[Mike9241]

since this appears to be personal - you're fighting for the UC you got, no 1099 is needed. the fees paid, based on that conclusion, are personal and therefore not deductible.

[AnthonyD2004]

Would that apply even since the case was me proving my self employment. I just want to make sure i don’t have to send one. i’m super stressed out about it. I read the penalties for not sending one are significant. 

[Opus 17]

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@AnthonyD2004 wrote:

Would that apply even since the case was me proving my self employment. I just want to make sure i don’t have to send one. i’m super stressed out about it. I read the penalties for not sending one are significant. 

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The IRS position is that anyone can issue a 1099, even if not required, because it helps to increase tax compliance.  So if you are worried as to whether or not you should, you can go ahead and issue it, because there's no harm if you didn't need to.

However, couple of points.

1. You need to get a W-9 from the lawyer.  They might be exempt from the 1099 requirement depending on the type of business arrangement they use (such as an S-corp, for example).  See what box they check on the W-9 and then look at the 1099 instructions to see if you need to issue one to that type of business.

2. To issue a 1099 on paper, you need special multi-part forms that you can only get from the IRS or a business supply store.  You also send a 1096 to the IRS that summarizes all the 1099s you issued.  You can't just fill out the PDF that you get from the IRS web site.  Or, you can issue a 1099 electronically using one of several different web sites, expect to pay $5-10, they will automatically include the 1096.