For all of you running your own affiliate programs, what do you do for reporting payments to your clients for tax purposes?
I believe you are supposed to send 1099's to any client that you pay over $600 in one year. However, this is the extent of my knowledge on the subject. Does anyone know the full tax implications of having an affiliate program? Are there any quarterly payments that need to be made? Do we need to withold estimated income tax from the checks?
I've been looking online at a bunch of tax web sites and various search engines, but I have yet to come up with a good explanation of the law. If anyone has any additional info on this, or if you know of any good websites pertaining to this, please post here!
If I were you I'd contact an accountant in your local area. They will be able to advise you on the exact details of the laws and ways to use them to your benefit.
There are too many variables in the US tax laws for anyone here on WHT to outline all of them completely and accurately (unless of course there are accountants on WHT who care to share their knowledge).
Depends on whom you're giving the $$ to. If the entity you're paying is a corp, don't bother. If it's an individual, yes bother. As others have mentioned, your accountant will explain to you the exact rules.