Nagging Mom Post: IRS Deadlines Coming
Dear Erin,
Happy New Year! I’m starting 2025 by nagging you, even though I feel like you told me on the phone you are on top of these things. Nevertheless, I wouldn’t be much of a mom if I didn’t nag, so here goes.
Tax season for individuals is upon us, and that could mean five things for you:
If your nonprofit paid anyone $600 or more as an independent CONTRACTOR in calendar year 2024, you must send them a 1099-NEC which lists their name, social security number, address, the amount you paid them (total) and whether any money was withheld for tax reasons (in most cases, that’s a no.) You MUST get them these by January 31. They need them to file their taxes.
You also must send the IRS a summary form, detailing all 1099s you sent as well as the total 1099 payments made on a form numbered 1096. This is due February 28.
Similarly, if you had EMPLOYEES, or people on your payroll under your direction and supervision for whom you have been paying either a salary or an hourly wage, you must send them their W-2 forms by January 31. This should come out of your payroll system.
Just like 1096 forms, there is an aggregate form called W-3 which is the summation of all the W-2s you issued. The W-3 is due to the IRS by January 31, same day the W-2s are due. In fact, although the 1096 is due February 28, its easier to assume all four are due January 31 and just get them all finished and sent before the end of this month.
This is NOT REQUIRED but is a nice touch: donation summaries. Your individual donors are preparing to file their taxes by April 15. Most will itemize contributions to nonprofits as deductions. Even though you have been sending them tax letters acknowledging their contributions when they send donations throughout the year, it is helpful to send them an aggregate acknowledgement in January listing all contributions from the previous year. Donors who have made multiple contributions are grateful to receive one document with everything listed. It saves them the trouble of having to go back and find everything from last year.
That’s it. No more nagging. I’m sure you are on it, but let me know if you need any help. I have some recommendations for online 1099/1096 filings that I can offer, if you’ve find that your list of contractors has become too long to manage by hand.
Have a great week,
Love, Mom
