That short window between year-end close and the January 31 deadline can feel like a sprint for hotel finance teams rushing to get 1099s out the door. From chasing down missing W-9s and balancing year-end reports to last-minute runs to Staples and stuffing envelopes in triplicate, the cycle can feel like a mix of pressure, paperwork, and panic every year.
What if there was a way that you didn’t have to scramble after the holidays?
With a few smart shifts in process and technology, you can take control of tax season before it takes control of your January. Here’s a look at our proven 1099 best practices that help hotel finance teams stay organized, compliant, and stress-free—long before January’s deadline arrives.
1. Onboard vendors/contractors with W-9s immediately
While this might sound like a no-brainer, this step sometimes takes a backseat because your teams are focused on solving problems fast, not filling out forms. An air conditioner needs replaced in the middle of a heatwave. New entertainment needs booked at the last minute. A vendor drops out the day before a renovation.
Emergencies like these pop up frequently, and it’s easy to see how things like collecting a W-9 slip through the cracks—especially when new or rotating staff aren’t always sure who needs to be reported. By the time January hits, tracking down all that missing information becomes a headache for everyone involved.
The fix? Make W-9 collection a non-negotiable part of your onboarding process. No vendor setup, no payment, until that form is in. It’s a simple rule that saves hours of backtracking and ensures your 1099 records stay organized and compliant.
2. Track all payments carefully
The unique structure of hotels makes keeping track of payments just shy of a nightmare. Each department has its own needs, vendors, and approval processes. It’s not uncommon for invoices to pass through multiple hands and systems before they’re processed. This decentralization leads to inconsistencies that can snowball by year-end.
On top of that, hotels must accurately track how payments to a vendor were made, as different payment methods have unique reporting requirements.
The best way to mitigate these risks is to have all vendor and payment data flow into one unified platform, like HIA. That way, payments across all properties and systems are automatically consolidated, categorized, and tracked against 1099 thresholds.
3. Make sure your procurement/AP teams are well educated on 1099 nuances
Your GMs and AP teams are at the front lines of tax compliance. They’re the ones who create vendor profiles, classify them, process invoices, and initiate payments. They’re also the ones who should be well-versed in all nuances of tax rules.
For hotels that manage hundreds of vendors across multiple properties and rely on dozens of people to keep those relationships running smoothly, this is easier said than done. To minimize the chances of errors come January, follow these best practices:
- Categorize vendors appropriately: Teams need to be able to recognize a vendor’s legal entity type (found in box 3 of their W9) and determine whether or not they require a Form 1099.
- Split services vs. goods: Only payments for services require 1099 reporting, so splitting invoices when vendors provide both is important.
- Meet filing deadlines: The deadline to file and furnish a 1099 is tight and non-negotiable (Jan. 31st).
- Account for state-specific reporting requirements: If a vendor performs work in or resides in a state with its own 1099 reporting law, the hotel may have an additional, separate filing obligation.
4. Implement internal controls and workflows ahead of year-end
Strong internal controls and consistent workflows are what turn tax season from a sprint into a steady close. Instead of waiting until January to audit your vendors, make reconciliations, and identify gaps, you should build in incremental check-ins throughout the year. This keeps everything current and organized long before deadlines hit.
Two of the simplest changes you can make are:
- Regular reconciliations: These catch missing W-9s, misclassified vendors, and payment errors before they become a problem in January.
- Vendor reviews: These help confirm that recurring vendors still have accurate information on file and the right classifications for 1099 reporting.
Whether you prefer monthly or quarterly checks, these small, consistent reviews make a big difference.
Additionally, consider establishing a shared workflow for who audits, who approves, and when. This will make sure that every property in your portfolio follows the same playbook. That way, when January rolls around, your team is simply reviewing, not rebuilding.
5. Leverage automation and technology where possible
Many hotels still rely on the manual approach (printing forms, double-checking tax IDs, chasing signatures, and uploading forms one at a time to the IRS site) for each individual vendor when it comes to filing Form 1099. But there’s an easier, faster way for hotels to handle it.
Instead of getting buried in paperwork every January, top controllers are using automation and structured systems like HIA to simplify the entire process. These workflows eliminate repetitive tasks, reduce the risk of human error, and ensure every vendor and payment is accurately tracked well before deadlines hit.
Once a vendor is added to the system, users can simply check a box indicating they are a 1099 vendor. The system will then capture their tax information from the W-9, flag 1099 eligibility, and track payments throughout the year. When teams are ready to compile a 1099 report, the system aggregates all information and flags any missing tax IDs.
For hotels ready to take automation to the next level, advanced features are available to further streamline the process. These include:
- Automated tax ID validation to catch errors before submission.
- Secure digital W-9 management that stores and organizes vendor records.
- Real-time data syncing across properties to prevent duplicate or missing filings.
- Electronic filing and delivery tools that submit forms directly to federal and state agencies.
With a centralized system and intelligent automation built for the way modern hotel finance teams operate, 1099 compliance doesn’t have to be a January scramble. It can become a simple, repeatable workflow that will help you win the season before it even begins, year after year.
For more information on how HIA helps finance teams get ahead of tax season, reach out to a specialist.
Jaime Goss has over a decade of marketing experience in the hospitality industry. At Hotel Investor Apps, Jaime heads up marketing initiatives including brand strategy, website design, content, email marketing, advertising and press relations.
