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posted Dec 7, 2024 4:56:45 PM

1099-NEC required on "package deal" on my water heater for my rental

Needing a water heater for my occupied rental condo rather pronto in 2022, I called around and amazingly on one of my calls a real plumber answered the phone.  He agreed to throw in a load of extras (air bladder protection), a new whole-unit pressure regulator, new pan underneath, etc.).  After considerable discussions I decided to spring for a commercial electric model, with estimated cost close to $3,400.  Plumber advised to buy it at Lowes with their CC, since in doing so I'd get about a $100 discount.   

 

Critical point #1 here is I never saw a breakdown of exact cost for labor vs heater since heater rather appears in my view a "package deal."  In other words, the way I purchased the heater was 'with installation' (although I could be wrong about this and have no idea of actual determinative tests for this or WHETHER IT MATTERS in terms of a need to send a 1099-NEC). 

 

Point #2 is the company handling the Lowes heater in my region is ARS Rooter, a huge company, which I suspect is corporate in scope, with a large local company (franchise?).    How can I tell what kind of company this is?  

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3 Replies
Level 15
Dec 7, 2024 5:07:34 PM

Level 15
Dec 8, 2024 6:40:16 AM

You do not need to issue a 1099-NEC.

 

It became a little fuzzy under the  2018 tax law. Landlords are, generally, still not required 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...

But, a landlord 1099 may be required to qualify for the Qualified Business Income (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. Reference: https://ttlc.intuit.com/community/investments-and-rental-properties/discussion/do-i-need-to-issue-a-1099-misc-to-a-contractor-for-my-rental-property/00/595692/page/2 4 page discussion (AmeliesUncle best reply)

Level 15
Dec 8, 2024 7:00:10 AM