Q&A #5: Nonprofit Form W9 and Form 1099

At Foundation Group, we get loads of questions about some nonprofit tax and compliance subjects that, on the surface, might seem obscure. Two of those issues are Form W9 and Form 1099. Would you believe we get multiple questions EVERY WEEK about these? Let’s get into it.
Nonprofit Questions and Answers... ANSWERED by Founder and CEO of Foundation Group, Greg McRay. Today, Greg answers viewer submitted questions submitted in the UA-cam comments and through our www.501c3.org website. We receive tons of questions, every day, from people all across the country, needing help with their nonprofit compliance. Today, we tackle those issues head on.
Today’s Topic: Nonprofit Form W9 and Form 1099
GOT A QUESTION?! Let us know in the comments. Your question could be answered in the next installment of Q&A with Greg.
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0:00 Introduction
0:47 What is Form W9?
2:05 What if Form 1099?
3:04 Question #1
4:00 Question #2
5:14 Question #3
6:29 Conclusion

[@FoundationGroup]

GOT A QUESTION?! Let us know in the comments. Your question could be answered in the next installment of Q&A with Greg.

[@imaginecommunityartscenter9706]

Our non-profit provided a day camp art class for a small school in our area. The cost was a total of $625.00. We served 25 students at $25.00 each. I received a 1099- NEC yesterday and I am not sure what the next step would be. Thank you in advance. Jenny with Imagine Community Arts Center

[@FoundationGroup]

Did you provide services to the nonprofit as an independent contractor? That's what receiving a 1099-NEC would indicate. If so, you would report the income on your tax return as business income on Schedule C, and deduct any directly related business expenses. Net profit from the activity is taxable income. If you did not provide services for compensation as a contractor, then you may have been issued the 1099 in error.

[@SADaveSED]

Does a nonprofit, such as The Salvation Army, 501(c)3 organization leasing a building from a church, also a "charitable" and "religious" 501(c)3 need to ask the church to complete a W-9 for The Salvation Army type of organization?

[@alyssaharris5943]

I thought all income, including gifts, were taxable. If they aren't taxable, why does it ask for it when I do my taxes?

[@FoundationGroup]

Unless you're filing taxes in another country, your Form 1040 does not ask you to report gifts received. Gifts are generally not federally taxable to the recipient.

[@followtheKing1111]

Hello! I wanted to start a non profit but was warry when I heard about needing board members that could ultimately control things. What if they take it in a whole bad direction?
Then I had a friend who started a non profit in CA and told me "I make all the decisions in my non profit" she basically said her board doesnt make the decisions, she does. And her board is more of an advisory boad. She claims I can make all the decicions and just put that in the "Bilaws" that thats how the non profit is run.
Was she wrong or did she find some kind of a loop hole?
How can she make all the decisions in her non-profit?

[@helives2209]

Does a non-profit issue a 1099 misc for rent to an LLC Property Management? Thank you. a lot of great information

[@FoundationGroup]

Sorry for the delayed response. In most cases, the answer is "yes".

[@linalinalina5977]

I have a 501c3 nonprofit , and another nonprofit is asking me to fill out a W9 before they give me food donations, how do I fill this form out and why do I even need to if my organization is not contracted to work for the other organization, we’re just getting food from them?

[@FoundationGroup]

We don't know the reasoning behind why the other organization is requesting a W9 from you. It is unusual. But, there's no harm in filling one out. Box 3a can be confusing, so mark "Other" and write nonprofit corporation in that line. Your box 4 exemption code should be "1". Then, just fill in your EIN number in Part I, then sign and date.

[@linalinalina5977]

@@FoundationGroup thank you so much for your help, you’re awesome 😎