CO-OWNED RENTAL PROPERTY 1099-MISC

[NILS1]

I co-own a vacation rental with a non-spouse relative.  We receive one 1099-MISC from the rental management company with our gross rental revenue (reported under my social security number).  In past tax returns, I have been reporting the entire gross 1099-MISC revenue amount on my Schedule E as Rents Received Income along with a related Other Expense on Line 19 equal to 50% of the rents received and the description of "Income reported on Schedule E by 50% co-owner."   (In researching this question, I have seen a discussion to report this expense under a description of "Nominee recipient adjustment to 1099-MISC income" or similar.)  The net of these two figures are my portion of the rental income. We each also report our 50% share of other expenses.  

My question is whether, under the revised 1099 rules, I now need to issue a 1099-MISC to my co-owner each year showing his portion of the rental revenue?  The amount involved varies each year, but each of his share rents received exceeds $20,000 (so it is well over the $600 amount).  I have not issued a 1099-MISC in past years and have never received any questions from the IRS.  Thanks for any guidance as the new rules are confusing.  

[Anonymous_]

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@NILS1 wrote:

(In researching this question, I have seen a discussion to report this expense under a description of "Nominee recipient adjustment to 1099-MISC income" or similar.) 

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Read the information at the link below (IRS publication) for the nominee reporting procedure.

https://www.irs.gov/instructions/i1099gi#en_US_2022_publink1000286907

[Anonymous_]

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@NILS1 wrote:

My question is whether, under the revised 1099 rules, I now need to issue a 1099-MISC to my co-owner each year showing his portion of the rental revenue? 

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Note that, aside from the nominee issue, filing Form 1099-MISC is only required when payments are made in the course of your trade or business.

See https://www.irs.gov/instructions/i1099mec#en_US_2022_publink1000276527

[GeorgeM777]

Yes, pursuant to IRS guidance regarding nominee income (income received in your name but that belongs to someone else) you must file a 1099 with the IRS and also provide a copy of same to the other owner.  Below is the IRS guidance on this issue.

Generally, if you receive a Form 1099 for amounts that actually belong to another person, you are considered a nominee recipient. You must file a Form 1099 with the IRS (the same type of Form 1099 you received) for each of the other owners showing the amounts allocable to each. You must also furnish a Form 1099 to each of the other owners. File the new Form 1099 with Form 1096 with the IRS Submission Processing Center for your area. On each new Form 1099, list yourself as the “payer” and the other owner as the “recipient.” On Form 1096, list yourself as the “Filer.” A spouse is not required to file a nominee return to show amounts owned by the other spouse. The nominee, not the original payer, is responsible for filing the subsequent Forms 1099 to show the amount allocable to each owner.

 

The above information was obtained from the following link:

General Instructions for Certain Information Returns (2022)

@NILS1

[NILS1]

Thanks for directing me to the relevant IRS instructions.  This has clarified what I need to do.  I appreciate your time and guidance!