Being a shop owner, can an insurance company demand a 1099 when i paid for repairs out of my pocket?

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Asked November 13, 2017

1 Answer

You had some damage done to the shop you own. You paid for the repairs out of your own pocket. Technically, you will get a 1099 Misc form when your situation has met one of the following conditions.

  1. Did you get any royalty payments? An example of a royalty payment is someone paying you for them using your work on their site.
  2. You say you own your shop. Unless you make rent payments to someone else, you will not be getting one of these forms.
  3. Are you paying anyone to come in and look at your shop's damage? Did you hire a contractor or lawyer? Unless you did this, you will not be getting a form.
  4. Are you paying any punitive damages because of what has happened with your shop? Unless this is happening, you will not be getting one.
  5. Is anyone hurt because of your shop? Is anyone getting any lab work done? Is anyone talking to a doctor and filing a report right at this moment? Unless you or your staff are doing these things, you are in the clear.

    There may come a time when you or your staff will need to see a doctor. Once this starts happening, then you will need to report the payments. Do not wait too long. There is a statute of limitation on how long you can go without seeing a doctor before the point becomes moot.
  6. Are you working with an attorney to get everything worked out? Are you cutting them a check right now? You will need to report this. The IRS frowns on you omitting items like this.

I suggest you speak with your insurance company to be safe. I do not anticipate you will get one of these forms, but you never know.

Answered November 14, 2017 by kai127

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