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1099-LTC for IRS and California FTB and issuing 1099-NEC

Got a 1099-LTC for a qualified LTCi. All reimbursements paid to non employee for assistance (understand the difference between non employee and employee). Only other income is social security for me & spouse.

 

Here is my understanding what has to be done for future reference.

 

1040-SR

 

TurboTax Deluxe filled out form 8853 Section C. My LTC reimbursement is not per diem and is below daily per diem limit of $390 anyways. $0 taxable to forward to Sched 1 to 1040 AGI.

 

California 540

 

California doesn't tax Social Security. Neither 540 or CA directions indicate anything about 1099-LTC. Looks like Turbotax just depend on IRS 8853->Sch1->1040 to pickup any taxable LTC. Therefore, Calif has no special rules for this.

 

1099-NEC

 

Get signed W-9 from contractor to keep on file.

Use W-9 info to issue 1099-NEC (using TaxBandits.com to efile federal, state, mail to contractor)

No need to worry about 1096 (TaxBandits.com handles coordination with IRS on efile)

Am filing late (1/31 deadline) So need to pay $50 late penalty for each late form (x2 1099-NEC to IRS, 1099-NEC to recipient)  Penalty will be assessed by IRS and notified via letter.

 

 

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