has any one heard about the new law the gov is going to make scrap yard start 1099 any one that sell metal to them?
New Guy
has any one heard about the new law the gov is going to make scrap yard start 1099 any one that sell metal to them?
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Yea I read something about that. The first sentance of the paper said "Because of obama's health care plan" we will be required to pay a 1099 starting jan 1. What does that have to do with health care? I guess the money has to come from somewhere. oh well it is what it is
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Just did some research and found this:
The new paradigm in Congress: Pass legislation first, then figure out what’s in it. We have certainly learned much about the worthless health care reform bill and now a real head scratcher. Section 9006 of Obamacare amends section 6041 of the IRS code so that when you buy or sell more than $600 of anything, within a fiscal year, you have an obligation under the new law to issue 1099s.
The purpose of the 1099 form has traditionally been to report income for contract labor. In fact, contract work is often referred to as working under a 1099. Now, the government may have chosen to use it to track something else: precious metals, barter and any other activities the government wants to track.
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Be aware that you also will have to send a 1099 to anyone or entity from which you purchase ANYTHING for more than $600 over a year's time. Do you buy scrap metal, cars or office equipment for more than $600 to any one person/business? You will need to send each one a 1099.
People may laugh at me, but that's ok. I laugh all the way to the bank.
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Just did some research on the relation between the 'health care bill' and the new 1099 laws.
These new 1099 laws are to help, quote unquote, "fund the health care bill"
Metal Recycling Entrepreneur
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That is lame. Not our fault that they made a ridiculous health care bill that not even congress officials are willing to use, so now once again, the people have to pay for their "fundamental" thinking.
Metal Recycling Entrepreneur
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Has anyone heard anymore on this. I haven't gotten word from the scrap yard I go to about anything and the owner says he hasn't seen anything on this yet. That was 3 weeks ago but still, I would assume they got something by now.
Also, in order to do tax write off, you need a business name or would just your name work well enough. Hell, government wants to do this, I will definitely get some free gas! lol.
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Does this apply to minors too? If not, then I'm fine for a few more years
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Do you file taxes? If so, then "yes".Originally Posted by Scrap man
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Well, I guess (under)age has it's privileges. Sucks for everyone else though.
Metal Recycling Entrepreneur
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Never filed before off of scrap but if they are having forms, it sounds like they are gonna require us to starting next year. Was just wondering about the law going into place.
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Scrap man - Just be aware that anyone with net income of $400 or more from self employment is required to file a tax return. You are self employed if you carry on a trade (receive money for goods or services). Age is not a factor.
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Forgot about that...
Experienced Scrapper
I love your saying at the bottom of your posts. LOL! as a girl, i get laughed at..but not after i cash my scrap checks!! ha ha. and yes I have also looked into the 1099 new "thing". I am wondering if forming an LLC and paying 7 to 8% taxes with legal deductions would be worth the record keeping headache as opposed to just paying almost 30% tax on a 1099 in the state of wisconsin. I do not have the answers yet, but am meeting a lawyer soon to go over my best options. Love the scrap forum guys!!
Experienced Scrapper
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Just talked to the guys at my yard in chicago. They said Jan 1st they will have to start issuing 1099's. This may not be a bad thing though. It might get rid of some of the competition.
Experienced Scrapper
One more silver lining is that you could possibly write off expenses such as gas and supplies.
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As a legit business, you can also deduct what you pay for the scrap you sell as well as depreciate the vehicles and tools you use. If you use a vehicle which is also used for personal use (ie: your car), you will also want to keep a record of mileage for business use as well as mileage on Jan 1st and Dec 31st. Do not be afraid of an audit, as long as you keep some form of record. It doesn't have to be anything fancy - I use a Word Document and every year is on the same Document. In the beginning, you may well show a Business Loss and actually pay less taxes than you would have. Again, don't worry about it, the IRS expects a loss in the beginning.
New Guy
I asked a lady in the office of the scrap yard I sell to, and she told me that they were only going to 1099 the big companies and not the peddlers. But She might not know what she is talking about. But if they don't it will not hurt my feelings.
" Where others see trash I see cash "
yeah i dont see how they cn mess with peddlers there is so many larger scrap companys out there a peddler can go to like 20+ other companys and i know they cant link them all up YET. keyword YET
Metal Recycling Entrepreneur
They don't have to link the companies all up. All they have to do is implant a computer chip, and link you up... :eek:
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