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How is 1099-MISC Box 6 different? What goes in Box 6?

Generally, corporations are off the hook when it comes to 1099-MISC reporting. But there’s a key exception with Box 6. If you pay $600 or more to any licensed medical or health care provider (doesn’t matter if they’re a sole proprietor- LLC, C corp, S corp, or even a professional association), you will have to file Box 6 of 1099-MISC. This rule also covers payments to large hospital systems, government agencies, and self-insured employers. So for Box 6, pretty much everyone is subject to reporting, regardless of their business structure.

Who Needs to File 1099-MISC Box 6?

The following are the mandatory filers who gotta file 1099-MISC Box 6:

What Counts as Medical and Health Care Payments?

The payments of $600 or more that goes to 1099 misc healthcare providers like doctors, clinics, or hospitals for medical services are counted as form 1099-MISC medical payments. These payments are reported in 1099-MISC Box 6. One thing to remember is that these payments are reportable even if the provider is a corporation.

Payment Type Box to be Reported Description
Licensed clinical services 1099-MISC Box 6 Professional medical services furnished by licensed providers like doctors, dentists, therapists, psychologists, etc.
Radiology, x-ray services 1099-MISC Box 6 Payments for diagnostic and imaging services ordered or performed for patients are reported here.
Rehabilitation and therapy 1099-MISC Box 6 Payments to rehab/PT/OT services and nursing care provided to patients are included in Box 6.
Emergency medical response 1099-MISC Box 6 Payments made to ambulance and EMT or paramedic response is reported in Box 6 form 1099-MISC.
Counseling services 1099-MISC Box 6 Payments for treatment or counseling services related to substance abuse also come under Medical or Health Care Payments.
Note:

Payments to tax-exempt hospitals, extended care facilities, or government-owned healthcare facilities are generally NOT required to be reported in 1099-MISC.

What payments are excluded from Box 6 on 1099-MISC?

Here’s what doesn’t go in box 6 of the 1099-MISC:

Pre-filing 1099-MISC Checklist for Box 6

W-9 Collection

Snag that W-9 from your provider before filing your 1099-MISC form.

TIN Matching

Plug their TINs into the Tax1099’s TIN matching portal to cross-check with the IRS database. Better safe than sorry, right?

Identify nature of Service

Make sure the nature of services are actually licensed medical payments according to the IRS 1099 misc medical rules.

Payment Type

Tally up all the payments for each provider by their EIN. Just a bit of number crunching, we promise! And if you paid with a credit card, that’s gonna be a 1099-K, so you can skip this part.

Record Keeping

Jot down the payment date, what the service was, and how much you paid. Hold on to every invoice, document or any proof you got. And once you file 1099-MISC, keep the records for atleast 3 years.

Initiate Backup Withholding

If your provider doesn’t send back the W-9, you gotta start that 24% backup withholding. One task added to the list but it keeps things in the clear!

How to File Box 6 Correctly: Step by Step

Now that you know what and when to use box 6 on 1099 misc, it’s time to understand how to file box 6 of 1099-misc for doctor payments.

There are majorly three different ways to file a 1099-MISC Form. You can either choose to paper file or submit electronically. According to IRS, if the total 1099 forms extends beyond 10 in a particular year, the payer must file them online.

Add Payer’s Information

Collect payer (organization, business, or individual paying $600 or more in medical payments) information such as name, address, and EIN.

Add Recipient’s Information

You can use Tax1099’s digital W-9 collection tool to collect recipient (individual or entity receiving the payment) legal name, address, and TIN.

Fill Box 4 (Withholding)

If TIN is not provided by the recipient, apply a 24% backup withholding to the medical and healthcare payment and enter that amount in this box. You can use Tax1099’s real-time TIN matching to verify TIN with IRS records to prevent backup withholding.

Box 6 (Medical & healthcare payment)

Report the total gross amount paid for medical services in a year. It must be more than $600 in a tax year.

Boxes 15 to 17

These boxes are applicable only for the state that require 1099-MISC state reporting.

Recipient Copy Distribution

Send the recipient copy of the forms by January 31 using Tax1099’s recipient copy distribution portal (IRS-compliant eDelivery) or via our print and mail feature.

Remember

All payments for medical or health care services are reportable regardless of the recipient’s corporate status.

Frequently Asked Questions

The minimum threshold for reporting royalties on Box 2 1099-MISC is $10 in a calendar year.

Yes, if the hospital rendered medical services and you are in trade or business with them, you must file a 1099-MISC and report the payment in Box 6.

In that case, you don’t have to file a 1099-MISC. The payment processor (e.g., PayPal or credit card provider) files Form 1099-K if reporting thresholds are met.

No, Box 6 of 1099-MISC includes corporations, unlike most other 1099 reporting categories.

No, you don’t have to file 1099-MISC Box 6 unless you expect to exceed $600 for the year or are subject to backup withholding.

No, medical services go in Box 6 and general contractor services go in 1099-NEC. You must issue separate forms for different payment types.

You must file a corrected 1099-MISC and reissue it to both the recipient and the IRS.

Only if they are state-licensed healthcare professionals. Otherwise, classify the payment as a general service, not medical.