W9 and 1099 Compliance

Having a successful referral program where you are rewarding your Members with monetary rewards for a ton of great referrals sounds like a win-win scenario, right? As great as that is, you still want to make sure that you are staying in compliance with US tax laws.

According to the IRS, you must provide a 1099 to any individual who earns $600 or more in a calendar year from your organization.

From inside of Referral Rock, you have the capability to stay tax compliant with our annual payment limits, 1099 reporting and excess payment enablement.

In this article you will learn how to:

  • Set up annual payment limits so that you will remain in compliance with US tax law
  • Download a report that will provide you with who is owed a 1099 or at risk of needing one
  • Allow excess reward payments once you have collected a recipients 1099 information and approved them for additional rewards

Reward Payment Limits

Referral Rock allows you to be proactive and stay in compliance by limiting reward payouts for recipients to the annual U.S. taxable limit of $599 (USD). When enabled, we will not issue more than $599 to the same person without your permission.

This feature can be turned on from the Payouts page (Settings > Payouts).

Once turned on, you will then designate which Payouts apply to the annual payment limit by editing each applicable payout type.

The annual limit will retroactively apply for all reward payments made in that calendar year and will reset at the end of each calendar year.

Once enabled, rewards that exceed the annual $599 limit, will remain in Pending status until you have confirmed that the recipient is in compliance and is approved for excess rewards (see below).

This feature is available for our Growth and Established Business Plans only

1099 Reporting

With our Annual Payments (1099 Report), we will tell you who you owe a 1099 to, and who may be in risk of compliance so that your team can get ahead of it.

On the Reports page (located under your account name dropdown in the top right corner) you can easily access and download a CSV report of all reward recipients who qualify for a 1099.

You can customize this report by selecting the calendar year, payout types and recipients that you would like reflected in this report.

Excess Reward Approval

In order to remain tax compliant, with annual reward limits turned ON, we won’t pay anyone in excess of $599 without your permission.

Once you have collected 1099 information outside of Referral Rock and confirmed that a recipient has qualified for excess annual rewards, you can indicate that on their Member Profile from inside of Referral Rock. (Member Profile > Edit Member)

Once approved, a Member can now be issued rewards that take them above the annual payment limit of $599.

This feature is available for our Growth and Established Business Plans only


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