What Constitutes the 1099 Sales Terminology

A 1099 sales contractor is a legal term that is firmed in the United States that refers to an outsourced professional who contracts his or her services to a series of businesses. One cannot confuse contracted professionals as temporary staff as these are a different set of professionals working for a fixed period of time. Details on the contract should be specified wherein the contracted person is not entitled to employee benefits.

Professional 1099 sales contractors are not only concentrated in the sales field, they are a part of the multiple task force brigade. They start right from consultants, builders, freelance agents, planners, and other work at home representatives. The number refers to the IRS or internal revenue system form that a freelancer has to fill in by stipulating the revenue that he or she has received for a particular tax year. 1099 sales consultants do not enjoy the benefits that employees do in a full time work environment. What they do have is a flexible work schedule and location. However, they differ from salaried workers since they are not entitled to medical allowance, retirement benefits and other add-ons that full time professionals enjoy.

From the point of view of companies contracting the services of 1099 sales professionals, it is mandatory to disclose this while filing tax for the year. It is an obligation where the manufacturing firm must specify that the person on the consultant role is who he says the person is along with the description of services provided. In addition to this, it is important for the firm to establish the commission level that is paid out to the person(s) on a case to case basis. In the event that the 1099 sales contractor is reimbursed for any payout, it is the responsibility to have supporting documents to back this up.

It is important for a firm to have an agreement in place along with the scope of services and the level of commission and bonus allotted to the contractual professional. It is also extremely imperative that every firm, employing the services of 1099 sales professionals, should receive a statement either on a monthly or weekly basis backed up by receipts, accounts receivables and accounts payable. An additional legal emphasis must be ensured that the sales representative has a responsibility for his/her taxes on the earned income. If the contract has been cancelled then all financial supporting during his or her tenure must be in place and never destroyed.