Trent Cotney, CEO, Cotney Attorneys & Consultants
If your company uses individuals as independent contractors, you should be aware of a new requirement that went into effect on October 1, 2021. As part of Senate Bill 1532, you must report to the Florida Department of Revenue any independent contractor
you pay $600 or more in a calendar year.
This new requirement was included in SB 1532, which addressed issues related to child support. The intent was to ensure that individuals hired as independent contractors, not employees, must have their income reported to the State Directory of New Hires for the purpose of collecting child support via income deduction.
The bill requires a service recipient to report to the State Directory of New Hires any individual, other than an employee, who is paid $600 or more in a calendar year for services performed for the service recipient’s trade or business. You are considered a service recipient if you engage in a trade for which an individual performs a service in a capacity other than that of an employee.
In the report, you must include the following information regarding the independent contractor:
■ Name
■ Address
■ Social Security number or another identifying number per section 6109 of the Internal Revenue Code
■ The date services for payment were first rendered by the individual .
■ The service recipient’s name, address, and employer identification number.
There is an exception for contract workers performing intelligence or counterintelligence functions with a state or federal agency if the disclosure could endanger their safety or compromise an ongoing investigation.
Service recipients must file reports on these individuals within 20 days after the earlier of these two dates:
■ First making a payment that requires an IRS Form 1099
■ Entering into a contract providing for such payments.
Florida businesses that pay an independent contractor $600 or more in a calendar year must follow the requirement of submitting
new hire information to the Florida Department of Revenue. Note, however, that many third-party payroll providers already perform this service, so check with your Human Resources department to see if that is the case for your company. Also, be aware that this new requirement pertains only to individuals, not companies or corporations with whom you may contract.
For more details about this new requirement, visit the Florida Department of Revenue site at www.floridarevenue.com. If you have concerns about how it impacts your company, please contact us for more information.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.
Trent Cotney is Board Certified in Construction Law by the Florida Bar, an advocate for the roofing industry and FRSA General Counsel. For more information, contact the author at 866-303-5868 or go to www.cotneycl.com.
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