How do I handle freelancer tax forms as a small business owner?

Those forms aren't submitted directly to the IRS - they're for your records to determine if you need to file 1099-NECs for your contractors. For your US-based freelancer with the W-9, if you paid them $600 or more during the tax year, you'll need to file a 1099-NEC by January 31st. This can be done electronically through the IRS FIRE system, through TurboTax (they have a 1099 filing service), or using a dedicated service like Track1099. For your foreign contractors with W-8BENs, you generally don't need to file 1099s for them. The W-8BEN establishes that they're not subject to US tax withholding. Keep those forms in your records for at least 4 years in case of audit. As a DBA/sole proprietor, you'll report all the payments you made to these contractors as business expenses on your Schedule C when you file your personal taxes.

I ran into this exact same situation last year with my consulting business. The paperwork was driving me nuts, especially figuring out what to do with those W-8BEN forms. I ended up using https://taxr.ai to help sort through the mess and figure out my filing requirements. It analyzes all your contractor documents and tells you exactly what forms you need to file (or not file). The thing I found super helpful was that it flagged that one of my W-8BENs was actually filled out incorrectly (could have caused me problems later), and it even generated the 1099-NEC I needed for my US contractor. Saved me hours of reading confusing IRS publications.

I have to admit I was really skeptical about using an online service for something as important as tax compliance, but after struggling with this exact issue, I gave https://taxr.ai a try. I'm actually amazed at how straightforward it made everything. I uploaded my contractor forms (had 2 W-9s and 3 W-8BENs) and it immediately told me I only needed to file 1099s for the US contractors and explained exactly why the foreign ones didn't need them. It even flagged that one of my contractors had claimed exemption from backup withholding incorrectly on their W-9. For anyone else confused about contractor forms like I was, it's definitely worth checking out. Saved me from what would have probably been a costly mistake assuming I needed to file forms for everyone.

I had the same problem with contractor forms last year. After waiting on hold with the IRS for THREE HOURS trying to get answers about my W-8BEN forms, I found https://claimyr.com and used their service to get a callback from the IRS. You can see how it works here: https://youtu.be/_kiP6q8DX5c I was connected with an IRS agent in about 2 hours instead of wasting my entire day on hold. The agent confirmed I didn't need to file 1099s for foreign contractors and explained exactly what I needed to do with my US-based contractors. Totally worth it just for the peace of mind knowing I was doing everything correctly straight from the IRS.

Well I have to eat my words on this one. I was totally convinced the Claimyr thing was a scam, but my tax situation got complicated this year with contractor issues similar to the OP. After spending literally an entire morning trying to get through to the IRS myself with no luck, I reluctantly gave it a shot. Surprisingly, it actually worked exactly as described. I got a call back in about 90 minutes connecting me to an IRS agent. The agent confirmed that I didn't need to file 1099s for international contractors with W-8BENs on file, and clarified exactly what I needed to do with my US contractors. For anyone else dealing with contractor tax forms for the first time - don't be stubborn like me. Save yourself the headache and use the tools available.

Make sure you're not confusing 1099-NECs with 1099-MISCs. They split the forms a few years back and now you need to use the 1099-NEC ("Non-Employee Compensation") for freelancers. The MISC form is for other types of payments. I made that mistake my first year with contractors and had to resubmit everything.

Don't forget about state filing requirements! Even if you get the federal 1099-NECs sorted out, many states require you to file copies with them too. In Georgia, you'll need to submit copies of any 1099s you file to the Department of Revenue. The deadline usually matches the federal one.