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Getting ahead now can help you avoid penalties, missing forms, and stressful January deadlines.
The IRS requires businesses to issue Form 1099s to report certain payments to vendors and contractors. Staying compliant means verifying who needs a 1099 and gathering accurate information before year-end.

1099 Compliance Checklist:

• Gather W-9s: Have a completed Form W-9 for everyone you’ve paid. You’ll need their name, address, and Tax ID number.

• Review vendor payments: Identify anyone paid $600+ for services during the year — including contractors, attorneys, rent, and professional fees.

• Track payments: Cash, check, or bank transfers count toward 1099s; credit card or PayPal payments are reported separately on a 1099-K.

• Check corporate exceptions: Most corporations don’t need a 1099, except attorneys and medical providers.

• Mark deadlines: 1099-NEC forms are due to recipients and the IRS by January 31, 2026.

Coming Change for 2026
Starting with the 2026 tax year, the 1099 threshold rises from $600 to $2,000, meaning fewer vendors will require one. This doesn’t affect 2025 filings but is a good time to update your tracking systems.

We’re Here to Help
Need help identifying 1099 recipients, gathering W-9s, or reviewing your records? GEM & Company CPA, LLC can ensure you’re accurate, compliant, and ready for year-end.

Maximizing the Standard Mileage Deduction in 2025

For 2025, the IRS standard mileage rate increases to 70¢ per mile for business-related driving only. The rate applies to cars, vans, pickups, and electric vehicles. Because it resets annually, business owners should update mileage-tracking tools and reimbursement policies each year. The biggest compliance risk and opportunity for savings is accurately separating business mileage from personal use.

Tracking Business Mileage & Year-End Best Practices

Only miles driven exclusively for business qualify, such as trips to clients, temporary work locations, meetings, and business errands. Personal miles, including commuting, school drop-offs, gym visits, and errands are not deductible. Maintain a mileage log showing the date, destination, business purpose, and miles driven. For mixed-purpose trips, only the business portion counts.

At year-end, reconcile mileage to ensure all qualifying trips are included. If you reimburse employees, confirm your accountable plan uses the 2025 rate of 70¢ per mile and issue any remaining reimbursements before closing the books. Keep mileage records for at least three years, as these deductions are frequently reviewed by the IRS.

How the Deduction Works for S Corps and LLCs

S Corporations

If the shareholder-employee personally owns the vehicle, the S corp must reimburse mileage under an accountable plan.
Reimbursements are deductible to the S corp and non-taxable to the shareholder when properly documented. If the S corp owns the vehicle, mileage reimbursement isn’t used, but business vs. personal mileage must still be tracked for fringe benefit reporting.

LLCs

Single-member LLCs deduct mileage directly on Schedule C. Multi-member LLCs should reimburse partners for personally owned vehicles under an accountable plan. LLCs taxed as S corporations follow S corp rules. With consistent tracking and proper documentation, the standard mileage method remains one of the simplest and most audit-friendly deductions available to business owners.

We’re Here to Help
Have questions about mileage deductions or accountable plans? We’re here to help you stay compliant and maximize your tax savings—just reach out. GEM & Company CPA, LLC can ensure your mileage deductions are accurate, compliant, and optimized for year-end tax savings.