How to account for payments to a non-US citizen who is no longer residing in the U.S?

Good morning,

I have a small LLC; during 2021 I used some labor help from a young man who is a UK citizen who was living here temporarily with his mom and dad. Before the end of 2021, the family relocated to Europe. Over the course of the year (7 small jobs), I paid the young man a total of $1420. He doesn't have a SSAN or a U.S. address and I'm pretty sure he's not filing a tax return for 2021. How do I account for this? Do I use a 1099-MISC?

238

Expert Alumni

Jan 23, 2022 1:39:58 PM

You can't deduct these payments.

The young man that you paid for his labor either had a work visa - in which case he has an ITIN for you to put on the 1099-NEC that you would be issuing him - or he did not have a work visa - in which case he isn't allowed to do a job a qualified American can do and you are not allowed to hire him to do it.

This is why you are supposed to fill out a form I-9 for all individuals that you hire on a contract basis.

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How to account for payments to a non-US citizen who is no longer residing in the U.S?