Am I responsible for issuing a 1099 for the fees I paid to the Property Manager of my rental property, if they sent me a 1099-MISC with the gross rental income reported?

[alvazi2]

Thanks for your response.

I assume you mean 1099-NEC, not 1095.

It's really difficult to find a clear answer if a 1099-NEC needs to be filed for property management fees paid to a property manager. On his W-9 the manager selected tax classification "Individual/sole proprietor or single-member LLC". 

Is that sufficient to conclude that I don't need to file a 1099-NEC?

The handling of rental income and expenses in TurboTax is clear to me, I have done that in the past.

Thanks.

[DaveF1006]

 In reviewing IRS rules, you would issue a 1099 NEC if you paid more than $600 to an independent contractor if you have a business and registered as a business that requires a Schedule C filing. If you report on Schedule E, then you do not have a 1099 NEC reporting requirement.

This does not mean you are prevented from filing a 1099 NEC.  For an example, it is suggested that you issue a 1099 NEC so that you may qualify for the QBI deduction on your tax return. This Turbo Tax article gives an explanation that you may qualify for QBI if  "you’re a real estate professional for tax purposes (that is, over 50% of the personal services you performed in business during the tax year were in a real estate business you materially participated in for more than 750 hours that same year) then your rental income qualifies for the QBI deduction".  You do not need to file a business tax return to qualify for QBI in this instance.

To summarize, you do not need to file a 1099 NEC but you are not prevented from doing so.  The W9 by the a management company get your correct name and TIN and assumed you operate a business. It may be a good idea to file a 1099 NEC but you are not required to do so.

Yes, I erred in my previous post. I did mean a 1099 NEC and not a 1095. I apologize for that mistake.

@alvazi2 

[alvazi2]

Hi @DaveF1006, Thanks a lot for your detailed answer!

In my case I paid more than $600, do not have a business, and report on Schedule E. So from your answer I am concluding that I don't need to file a 1099-NEC, but can choose to do so.

If I may ask then about TurboTax Premier (online): I looked at the description how I could file such a 1099-NEC and tried it out (without saving), but it requires me to set up a record for me as a business (it has the option of using my SSN for that). So for now I gave up on that as I'm not sure if that is the right way to do it. 

I did find other online options, but if TurboTax could handle this for me, I would prefer that.

[DMarkM1]

Yes, you can create/e-file/print Forms 1099-NEC using TurboTax Quick Employer Forms.  You pay for that product by adding it to your TurboTax account through that link.  You would use you social security number as a tax ID on the forms. 

For rental property owners using Schedule E as stated by @DaveF1006 you do not have to file forms 1099 typically as those properties are typically treated as investments.  However, if you are electing to take the 20% qualifying business income deduction from your rental income, you are considering your rental, a business, and therefore would have a requirement to file 1099's if you paid $600 or more to a business entity.