General Landlording & Rental Properties

User Stats

6
Posts
1
Votes

1099s to Vendors required

Posted Jul 1 2022, 08:25

We have a few properties managed by a property manager. They pay vendors and they pay us, after taking their cut, then we receive a statement from them every month.

My CPA is saying we need to collect W9s from the vendors (carpet, cleaning, everyone that gets paid more than $600) even though they're paid by the management company.

My question, do we need to hunt down W9s from the vendors after the new 2021 rules? Or just let the property manager handle it issuing 1099s to the vendors? What do you guys do? Is my CPA wrong? 

Oklahoma City, Oklahoma

User Stats

5,290
Posts
5,546
Votes
Bjorn Ahlblad
  • Investor
  • Shelton, WA
5,546
Votes |
5,290
Posts
Bjorn Ahlblad
  • Investor
  • Shelton, WA
Replied Jul 1 2022, 09:12

Your CPA may think he/she is right-how much expertise does he/she have with REI? My CPA never asked about 1099s when we used a PM. I certainly would not chase the PM's vendors, I would have no need or desire to know who they are and that is what I would tell the CPA. All the best!

User Stats

18,230
Posts
28,492
Votes
Nathan G.
  • Real Estate Broker
  • Cody, WY
28,492
Votes |
18,230
Posts
Nathan G.
  • Real Estate Broker
  • Cody, WY
ModeratorReplied Jul 2 2022, 05:45
Quote from @Edward Green:

We have a few properties managed by a property manager. They pay vendors and they pay us, after taking their cut, then we receive a statement from them every month.

My CPA is saying we need to collect W9s from the vendors (carpet, cleaning, everyone that gets paid more than $600) even though they're paid by the management company.

My question, do we need to hunt down W9s from the vendors after the new 2021 rules? Or just let the property manager handle it issuing 1099s to the vendors? What do you guys do? Is my CPA wrong? 


Your CPA is wrong. The vendor is already provided a 1099 by the Property Management company (or should be). They do not need a second one from you.

User Stats

4,549
Posts
2,516
Votes
Drew Sygit#2 Managing Your Property Contributor
  • Property Manager
  • Birmingham, MI
2,516
Votes |
4,549
Posts
Drew Sygit#2 Managing Your Property Contributor
  • Property Manager
  • Birmingham, MI
Replied Jul 2 2022, 09:23

@Edward Green since you're not payng vendors, why would you have to collect W-9s & issue 1099s?

User Stats

6,473
Posts
5,112
Votes
Chris Seveney
  • Investor
  • Northern Virginia
5,112
Votes |
6,473
Posts
Chris Seveney
  • Investor
  • Northern Virginia
Replied Jul 2 2022, 13:34

@Edward Green

Not a CPA but I have never heard of this. You only give 1099’s to those you have cut a check to over $600. You cannot 1099 someone you have not paid.

Side note: if you use a credit card to pay the credit card companies send the 1099 not you.