In this blog, you will know how to create and file your Federal 1099s with the help of QuickBooks Online. QuickBooks Online provides various time saving features to help users prepare their 1099s from the details they already have in their accounts. 1099s are basically the tax forms user have to file with the IRS when they pay contractors in cash.
Learn the simple steps we have given below in order to create and file your 1099s (1099-MISC and 1099-NEC) using QuickBooks Online. When you do so, Intuit also takes care of sending mail a printed 1099 copy to your contractors so that they can utilize this for their tax filing.
Step 1: Know what and when you need to report
Do you require to file 1099?
The IRS needs users to file a Form 1099-NEC for the non-employee that user:
- Paid $600 or a large amount in cash during the last year. Note: The IRS does not provide electronic payments to be reported on Form 1099-NEC or 1099-MISC. You will not have to report payments you send them electronically, for example by credit card payment, debit card payment, gift card, PayPal payment, or any other. QuickBooks Online itself excludes all the work automatically for its user. The respective payment companies automatically report those payments so users do not have to worry anymore.
When are 1099s due to the IRS?
1099s are due to the IRS and the contractors of the users by February 1, 2021. However, we highly suggest you e-file 1099s before 28th January 2021, at 5:00 PM PT. This will make sure that your 1099s will be postmarked to your respective contractors by 1st February 2021. Users are able to e-file 1099s through February 1, 2020, to be at the correct time with the IRS.
Do you need to file 1099s in your state?
Remember that the 1099 E-file facilities are only for federal 1099-MISC and 1099-NEC filings. If you want more information on what states need a 1099 filing or support combined filings visit the Intuit site for the information. You can also contact your state for detailed information and to know how to file.
Step 2: How to set up your 1099 accounts
In case you have to file for both form 1099-NEC and a 1099-MISC, you will need to modify your account and contractor payments. This can be identified by which kind of boxes you choose for the payments types you made to non-employees. Some of the companies only choose “non-employee compensation” for the payments of their contractor. In such a case, there are no requirements for any adjustments that are needed. However, in case you have to choose any different types of payments to report, you will have to complete a few accounting works to prepare your books.
Step 3: How to create your 1099s in QuickBooks Online
Here are the full steps on how to create your 1099s ready to e-file or print. To know what you have paid your contractors, you can also run 1099 reports.
- Click on the Workers or Payroll menu, then go to the Contractors section. Or you can choose the Expenses and then hit Vendors.
- Click on the option to Prepare 1099s and then choose to Let’s get started.
- You have to ensure that the name, address, and tax ID of your company is correct and matches that is found on tax notices or letters from the IRS.
- Now choose the boxes that are showing the payments type made to all of your contractors this year, then hit on the Next.
- Make sure that all of your contractors are showing up and their personal details with email addresses are filled correctly.
- In case you are missing any contractor, choose to Add from the Vendor list and click any additional 1099 contractors from the list of your QuickBooks Vendor. Then hit on Next.
- Ensure the totals payment for each and every box you have been chosen in step 4. Your payments will automatically split into the 1099-NEC and 1099-MISC forms. Then hit on Next.
- Now choose the E-File for me option to e-file your 1099s. Or you can even go with the option of I’ll file myself in order to print and mail the forms yourself.
Step 4: How to E-file your 1099s
Till now you are well prepared after ensuring that the details are correct on your 1099s, let us move to e-file your 1099s.
- Once you have prepared your 1099s, go to the E-File for me category.
- Here you need to verify the 1099 Forms, then click on Continue.
- Now review your 1099 Forms and ensure that the details brought over from QuickBooks Online are mentioned correctly. You can choose all or choose only the 1099 forms you have to submit. Then hit on the Continue.
- Fill out the billing details, then click on Approve.
Remember this detail will not be imported from QuickBooks Online. On the first moment, you will be prompted to fill out the details about billing and credit card.
- Again review the form’s number and the total amount, then hit on Continue.
- If you get prompted, select the option of delivery for your contractors’ copies.
- Validate or type missing email addresses for all of your contractors so that Intuit can send access in order to see their 1099 forms online. Your contractors with provided email addresses will get an invitation link to access their 1099 forms online.
- Hit on the Continue.
- See, download and give 1099 Forms “Employer: Copy 1 & Copy C” and “Contractor: Copy B & Copy.” In case you are choosing the View forms button, you will only receive Copy A that Intuit sent to the IRS. Other 1099 copies will be available from the Home page.
- Again hit on the Continue.
- Submit final forms in order to submit. Ensure that you have correctly reviewed the 1099 forms before submitting them as Intuit does not handle corrected forms.
Step 5: How to check your filing status
Once you file your 1099s to the IRS from the listed steps above, Intuit will notify you of the status of your filings via email. Users can even check their filing status anytime by in their 1099 E-File account.
These will be the list of statuses and see what they mean:
- Not Submitted: It means users have not e-filed Form 1099-NEC or 1099-MISC to the IRS. However, users can continue revising it.
- Submitted: It means users have e-filed the form to the IRS. Note: In case users need to revise it, they may require to file a manual amendment. So utilize the IRS instructions and form to do this.
- Received by IRS: The IRS has got the form of user and is either processing it or has been processed and approved it already. If users have submitted their 1099 E-File forms, they will get an email for confirmation just after a week of IRS receive and confirms their submissions. The user may not get this confirmation until the middle of January month or later.
We hope you find the answer to your query related to 1099s filing. Take the appropriate steps to create and file 1099s with the help of Quickbooks online. If you get any glitches in between filling 1099s to the IRS, please let us know. You can contact our technical or QuickBooks online support number at +1-877-798-1556.