1099-MISC ...Taxes for Rehab Projects?...omg help

[David Zheng]

Hi All,

Just a quick question on 1099-Misc forms..

I bought a property in Oct 15 under my solely owned LLC. I bought it for 230k and had a construction loan along with the HML loan of another 85k. Fastforward to Jan 1 and the place is all fixed and rented out but I spend an extra 25k of my own money to rehab.

So 230K(purchase)+85k(rehab)=315k (total Loan amount)

my 25k (extra rehab)= 340 all in

Contractor Costs- $22k electrician
28k- HVAC

6k- Plumbing
10k - Painter

8k- other contractor

Do I have to issue a 1099- MISC or are they supposed to send something to me? Also do I just have to issue a 1099- MISC to up to 25k worth (my portion) of contractors or do I have to send it to every single one that did a project?

Thanks for your time!

[Cameron Skinner]

@David Zheng if you paid them your required to send them a 1099, it doesn't matter if proceeds came from a loan. If they are incorporated or an LLC filing as a corporation then you don't have to send them a 1099. In FL most contractors are S-Corps due to the worker comp rules so I don't have to send out too many 1099s but even if they are a Corp make sure you still get a signed w-9 from them because then you will have proof that you confirmed their filing status in box 3

Hope this helps good luck!