1099 to cut the grass?

[vgentry]

I have an elderly tenant who is unable to take care of the yard so I usually just cash app one of the neighborhood teenagers $50 or so to mow the grass each week. Do I have to send him a 1099?

[Critter-3]

If you will be deducting this expense on the Sch E for the rental AND you pay him $600 or more  AND you are treating the rental as a business for the QBI  then   YES   otherwise  NO.

[vgentry]

So I guess $50 a week will eventually add up to over $600. Yes I treat it as a rental and it comes out of the business account. I linked my business account to my CashApp account and send it that way. 

That just seems weird, sending a 15 year old kid a 1099 for mowing the grass.

[Critter-3]

Self employment income knows no age min or max  ... this is the paper trail needed to deduct the expense for "contractors" on the Sch E.

[NCperson]

@vgentry - and let the teenager know in advance....he'll have to file a tax return and pay self-employment tax if you provide him that 1099.

[Carl]

Understand that if the amount is less than $600 for the year to "any" "one" "individual" then the 1099 is not required.  Also, to correctly complete that 1099 (which should be a 1099-NEC and not MISC) you will require their SSN or EIN. So they'll need to provide you a W-9 form for that.

[VolvoGirl]

Here's a blank W-9.  It does not go to the IRS, just to you.

https://www.irs.gov/pub/irs-pdf/fw9.pdf 

[vgentry]

So let me ask this question.  If I send up to $600 to him and another up to $600 to his mom is that ok? 

[rjs]

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@vgentry wrote:

So let me ask this question.  If I send up to $600 to him and another up to $600 to his mom is that ok? 

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That sounds like a pretty clear case of tax evasion.

[rjs]

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@vgentry wrote:

So let me ask this question.  If I send up to $600 to him and another up to $600 to his mom is that ok? 

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Note that the filing requirements and the requirements to issue a 1099-NEC are different. The teenager is legally required to file a tax return if he earns $400 or more for mowing lawns, whether or not he gets a 1099-NEC. If he earns more than $432 he will have to pay self-employment tax (but not income tax, unless he has other income). If he makes money mowing other lawns besides yours, or from any other self-employment, his filing requirement and his tax are based on his total income from all of his customers, not just the amount from any one customer.

If his mother has other income and files a tax return, she will have to pay tax on any money you pay her for having your lawn mowed, even if it's less than $600.

You should get the teenager's Social Security number, and issue a 1099-NEC if you end up paying him $600 or more. Don't play games with the IRS. Just follow the law and let the chips fall where they may.

[TomD8]

@vgentry wrote:  "That just seems weird, sending a 15 year old kid a 1099 for mowing the grass."

You have to send the 1099 because you hired him "in the course of your business" and are paying him out of your business account.

If you were paying him out of your own pocket to mow the lawn at your own home, no 1099 would be required.

[Hal_Al]

Q.. Do I have to send a teenager a 1099 for cutting the grass at my rental property?

A.  Simple answer: No. 

It became a little fuzzy under the new 2018 tax law. Landlords are, generally, still NOT require to issue 1099 forms to service providers.

References: http://www.forbes.com/sites/irswatch/2013/03/06/should-landlords-be-filing-1099s-for-service-provide...

https://www.auburnmainecpa.com/1099s-required-small-landlords/

But, a landlord 1099-NEC may be required to qualify for the QBI deduction. Reference: https://www.nolo.com/legal-encyclopedia/do-landlords-need-to-file-form-1099-misc.html Most rental properties do NOT qualify for the QBI deduction. 

[SweetieJean]

But see this:

Do Landlords Need to File Form 1099-NEC? | Nolo

[TomD8]

And this from a CPA/Attorney:

https://markjkohler.com/1099-rules-for-business-owners/

I would not assume that a 1099 is not required.

[tagteam]

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@Hal_Al wrote:

Most rental properties do NOT qualify for the QBI deduction. 

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I would suspect the same. There is a safe harbor for the purposes of qualifying for the 199A deduction and it might not be prudent to claim the QBI deduction without meeting its requirements.

See https://www.irs.gov/pub/irs-drop/rp-19-38.pdf