The Office of Financial Operations and Systems (OFOS) ensures that the federal government is timely notified of all non-employee/miscellaneous income paid to individuals or combinations of individual and business entities (e.g., sole proprietorships, partnerships, trusts, medical-service corporations) during each calendar year. Non-employee compensation or miscellaneous income typically includes amounts paid to outside parties for services rendered to the District. However, non-employee compensation does not always take the form of direct payment for service. Non-employee income may also include fees, benefits, or commissions.
Staff in OFOS’s Accounting Operations Division ensures that IRS Forms 1099 Non-employee Compensation (NEC) and/or IRS Forms 1099 Miscellaneous Income (MISC) are sent to vendors and individuals, as well as the Internal Revenue Service (IRS) and are consistent with applicable laws and regulations. Information reported in the 1099s enables recipients of income from the District to prepare their income tax returns accurately and provides the IRS with information which may be used for compliance-monitoring purposes. The IRS is able to match the reported payments with the information shown on the recipient’s income tax return to verify that the income earned in the District was reported.
For more information regarding 1099 Non-Employee Compensation/Miscellaneous Income reporting, call the OFOS Accounting Operations Division at (202) 442-8250.