Part of appropriate affiliate program management is dealing with taxes and the IRS. When January rolls around, will you be prepared to file all the appropriate forms and pay your taxes? Answer the following questions to determine if you are ready.

Do you know why the question says January and not April?
While you do not have to file your taxes until April, you are required to send out 1099-MISC to all your affiliates by January 31. Therefore, as a business you must get your taxes prepared and ready to go months before the deadline to file.

Do you have 1099-MISCs ready to print?
If you can go into your system and print out 1099s for every affiliate, then you are way ahead of the game. If not, then it could be a last minute race to find missing affiliates and get them to sign off on a W9.

To better prepare yourself, manage your affiliate pay with the appropriate software. Free software is available to track W9s and print out 1099s at will.

Do you have W9s on every affiliate no matter how much they made?
If you have been putting off collecting a W9 until an affiliate made $600, then you could be in for a shock. Last minute sale pushes could set several affiliates over the $600 mark in November and December. This will drastically limit your time to find the affiliate, send them the W9 and have them sign and return the form to you before the January 31 deadline.

Again, this is where free software comes in nice and handy. It gives you the peace of mind knowing not one affiliate will receive pay unless they have a completed and signed W9 on file.

Do you have a tax preparer’s name and number?
If this is your first time sending the IRS 1099s, then it is a good idea to get some help with filing. While you are legally responsible for all the items on your tax return, the preparer will sign off on the form as well.

Tips filing a tax return using a tax preparer:

The preparer is required by law to sign the form. Therefore, make sure they sign it and give you a copy of the return.
Review document and check to see if your name, social security number, and address are correct. Additionally, there should be no blanks.
Review the entries made and make sure you feel comfortable with those figures.
Third Party Authorization – This is a box on the 1040 that allows a designee to speak to the IRS on your behalf. Only check if you agree to this stipulation.
A tax preparer may not charge a contingency fee (percentage of refund). Avoid any preparer that tries this in any form.
All preparers should come up with very similar amounts. Be wary of tax preparers promising bigger refunds.

After reading through the questions, you should have a good idea where your affiliate program management teams stands with the IRS. Now is the time to make adjustments and to get everything in order.

Would you like have a service for your online business that tracks all W9 and 1099 information for your tax records on file? Try this free software for affiliate program management that requires payees to fill out a tax profile. Visit PayPeopleOnline.com to keep your business away from tax nightmares and raising flags with the IRS.
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