Split Income from 1099-K

[GILLIO]

My friend received a 1099-K for the full year earnings from Patreon. However, he asked me to help him with his business and split his income with me. Does he need to issue me another 1099 or can we just split the income in our personal tax returns?

[GILLIO]

Keep in mind, my friend is Self-Employed and there is no partnership or LLC  associated for this year

[MinhT1]

You are acting as your friend's sub-contractor.

Your friend has to issue a form 1099-NEC and has to file that form with the IRS. He can then deduct the amount he paid you as his business expense as Payment to contractors.

As for you, you'll need to report the form 1099-NEC as Self-employed income. If you have expenses, you can deduct them against that income.

[GILLIO]

OK thank you. In looking through the information, it would seem like he needs to first mail a 1099 to the IRS. I saw something saying this service may also be available through TurboTax? Does a mailed 1099 need to get approved first before we both can proceed?

[GILLIO]

And does that also include the filing of form 1096, which seems to also be needed

[JamesG1]

You may proceed based upon the knowledge that the 1099 is being prepared and will soon be received.

You may create W-2's and 1099 forms using Intuit's Quick Employer Forms.  See this link.

You may also create W-2's and 1099 forms using TurboTax CD / Download Home & Business.

@GILLIO 

[JamesG1]

You may mail the 1099 form(s) including an IRS form 1096 or you may electronically file them.  You do not receive an 'approval' from the IRS.

This website summarizes which state may require separate filing of 1099 documents.

Whichever way you file, print out copies of all of the paperwork and retain in your files should a tax authority have questions about the forms at a later time.

@GILLIO 

[GILLIO]

Thanks for all the help. I have filed electronically with the Quick Employer Forms. It now says this is in process with the IRS. If my understanding is correct, based on your answers, we should now just file our taxes based on the forms we submitted. We won't get a notice from the IRS about the forms being accepted/rejected, so we should just keep our copies should the IRS have questions later.

@JamesG1 

[DianeW777]

Yes.  File your returns with the correct forms/income for each of you now that the 1099 has been issued to you.  There is never a guarantee the IRS will not inquire, but you have all the detail and filed forms required.  You have no need for concern, accuracy is what they require.