Time-sensitive Form 1099 information for groups
In 2016, some of your clients began paying you or your agency a service fee instead of commission. The Billing and Collection Agreement states the service fee is considered “non-employee compensation” and requires employer groups to complete two copies of the Form 1099-Misc — sending one copy to you, and the other to the IRS.
We’re currently in the process of notifying all employer groups with a service fee arrangement of their obligation to send the necessary information to you. We will include a table with all the relevant information they need to complete the Form 1099 regarding your agency. The employer groups are required to complete the Form 1099 and mail it to you by January 31, 2017.
There is no action required on your part other than to look for the completed Form 1099 in the mail from your client.