The 1099 is the IRS form that small business owners fill out for their self-employed contractors. Here is an annotated explanation of all 18 fields. http://quickbooks.intuit.com/r/legal-taxes/1099-form-explained-annotated/

1. The 1099 Form, Explained and Annotated

3. Box 1, Rents
If you paid rent for your business space to an
individual, this is where you enter the total amount
you paid during the calendar year. You can also
enter amounts for things like equipment rentals, as
long as they’re paid to an individual.

4. Box 2, Royalties
If you are paying someone for property rights
(whether physical, like mining, oil, or gas; or
intellectual, like in the case of a patent or
copyright) enter the total amount you paid here.

5. Box 3, Other income
Basically if you provided a taxable payment to
someone over the amount $600 and it doesn’t fit
in any of the other boxes, it goes in Box 3. Need
more details? Pub 525 gets right into the nitty
gritty of what qualifies as “other income”.

6. Box 4, Federal income tax withheld
This box is where you’ll reports any taxes
that you withheld from the amount entered
in Box 3.

7. Box 5, Fishing boat proceeds
This field likely doesn’t apply to you, but on the
off chance that you are the owner of a fishing
boat and you’re issuing this 1099 to a member of
your crew, you’re in the right place! Enter the
amount paid to them here.

8. Box 6, Medical and health care payments
Did your business make a payment of $600 or more
to an individual who provided medical or health care
services this year? Report that amount here.

9. Box 7, Nonemployee compensation
This is the box that you’ll most likely use to
report any payments paid to a contractor or
other non-employee.

10. Not sure if a payment qualifies?

11. Not sure if a payment qualifies?
The IRS provides these four
guidelines for determining if this
Box 7 is the right place to enter it:
4
3
2
1 You made the payment to someone who
is not your employee.
You made the payment for services in
the course of your trade or business
(including government agencies and
nonprofit organizations).
You made the payment to an individual,
partnership, estate, or, in some cases, a
corporation.
You made payments to the payee of at
least $600 during the year.

12. Box 8, Substitute payments in lieu of
dividends or interest
Most small business owners won’t use this one, but
if you did pay someone a sum of at least $10 instead
of dividends or if you are paying someone tax-
exempt interest as a result of borrowing their
securities, that amount gets entered here.

13. Box 9, Payer made direct sales of $5,000
or more of consumer products to a buyer
(recipient) for resale:
This field is actually fairly self-explanatory. Check
this box if you sold products directly to someone so
that they could then sell them to other people.

14. Box 10, Crop insurance proceeds
Are you an insurance company issuing this 1099
form to a farmer due to crop insurance payments?
Nope, we didn’t think so. Most of us will never have
a reason to use Box 10.

15. Box 11 & 12
Fun tax fact: In the past, the IRS used these boxes to
record any foreign taxes paid but these days this
information is reported on a separate form. They
couldn’t just delete these two boxes without also
renumbering boxes 13-18, so they just left them blank.
(You should, too.)

16. Box 13, Excess golden parachute payments
Another one you can probably skip - you’ll only ever
enter an amount in Box 13 if you paid a disqualified
person like a shareholder or highly paid person at least
three times that person’s typical amount.

17. Box 14, Gross proceeds paid to an attorney
If you’re issuing this 1099 form to an attorney for any
legal services in an amount greater than $600, this is
where you enter the amount you paid them.

18. Box 15a, Section 409A deferrals
Don’t worry about entering anything in this box. (If you’re a tax
nerd, super curious, or just looking for a little light
reading, Internal Revenue Bulletin 2008-52 can enlighten you.)

19. Box 15b, Section 409A income
Did you defer a payment that would have been categorized as
section 409A income because a nonqualified deferred compensation
plan didn’t meet the requirements for section 409A? Enter that
amount in this box. (And if you have no idea what we just said, don’t
worry, Box 15b most likely doesn’t apply to you. Let’s move on!)

20. Box 16, 17 & 18
If your state participates in the Combined Federal/State Filing
Program you’ll need to complete these boxes. Each field is
divided in two in case you need to report in two states.

21. Box 16
Record any State tax that you withheld from
your payment to this contractor.

22. Box 17
Enter the state’s abbreviated name and your state
identification number.

23. Box 18
Enter the amount of the state payment.

24. You’ve done it.