Lynda ArtesaniLegal Accountant and Data Migration Specialist at The Proper Trust

1099s and Personal Injury Law Firms

20 Feb 2024 · 1 min

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In this brief discussion, the speakers explain how 1099 reporting adds an extra layer of complexity for personal injury law firms, especially when certain 1099 amounts need to be reported in the medical box. They stress the importance of training paralegals, office staff, and attorneys to always obtain a signed W‑9 before paying any advanced costs, regardless of whether the payee will ultimately meet the $600 reporting threshold or qualify for a 1099. Collecting W‑9s early ensures compliance and prepares the firm for future engagements with expert witnesses or other service providers across multiple cases.

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But 1099s adds a whole nother layer of complexity to it because some of those 1099s might have to go into the medical box that you got to send it out. So that's something you have to consider.
Right up front, train your paralegals, train your office people, train your attorney. You do not pay out one advanced cost to anybody until you have a signed W-9 in hand. Whether you'll ever use it or not, right? Whether they'll ever qualify for a 1099 or meet that $600 threshold or whatever, get in the practice of getting those W-9s right away because you might hire that expert witness for 10 cases in the future. You don't know it today, but it might happen this year. You don't know.