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Set up and file 1099 forms

What is 1099?

1099 is a series of forms used to report non-salary income or the money earned from self-employment, independent contractors, etc… There are several types of 1099 forms, however, the most common and the ones that you would usually need are the following:

1099-MISC The year end summary of all non-employee compensation that meets the IRS thresholds. Reported in this form are cash and check payments (unpaid bills are not included) from rent, royalties, self-employment, independent contractors, crop insurance proceeds and others. QuickBooks can track reports for and e-file/print the 1099-MISC forms on pre-printed forms.
1096 The compilation of all filed 1099-MISC forms. QuickBooks allows printing of 1096 forms on a pre-printed form.
1099-K Reports all electronic payments made between businesses. This is filed NOT by QuickBooks users but by electronic payments companies like PayPal, Mastercard, Visa and American Express. Reported in 1099-K are credit/debit card and electronic payments for all non-employee compensation that meets IRS thresholds.

Why do you need to file 1099s?

As a business owner, you are required by the IRS to submit copies of 1099-MISC forms for your hired contractors who are not part of the regular payroll.

Important: Make sure to file your 1099-MISC ahead of time to avoid monetary penalties and other sanctions.

The 1099 Wizard

The 1099 wizard is a handy guide that walks you through the steps in generating 1099 information and preparing 1099-MISC and 1096 forms for printing or e-filing.

Key Points

  • Electronic, debit and credit card payments are NOT included in the 1099-MISC Summary Report. They are reported in the 1099-K Form and are filed by electronic payments companies like Pay Pal.
  • Cash, Checks and bill payments within the calendar year are included on the 1099-MISC Summary Report. Unpaid bills are NOT.
  • There are 18 payment boxes on the 1099-MISC form used for mapping account payments. Each box has a specific IRS-mandated threshold. QuickBooks and Intuit E-file Service only support Boxes 1-10 and 13-14. Mostly, you would use Box 7: Non-employee compensation. The threshold for box 7 is $600.
  • When you change the vendor 1099 status in the wizard, it changes the vendor status in the company file.
  • Even if you opt for e-file, you still need to provide printed copies of 1099-MISC to your vendors (can be on plain paper).

For more information, see QuickBooks 1099 Wizard.

File 1099

File your 1099 forms after you have confirmed that your data is correct.

Intuit offers two filing methods – print and e-file service. The table below summarizes the differences between these two filing options.

Print E-File
Salient Points
  • When printing 1099-MISC, take note that each form comes in multiple copies.
    • Copy A: For IRS Center
    • Copy 1: For State Tax Department (if needed)
    • Copy B: For Recipient (Contractor/Vendor)
    • Copy 2: For Recipient (Contractor/Vendor); To be filed with the recipient’s state income tax return when required
    • Copy C: For Payer (Business Owner, QuickBooks Users)
  • Requires submission of 1096 to the IRS.
  • Intuit's E-file Service allows you to:
    • Fill in 1099 forms
    • Create & provide email or printed copies to your contractors
    • Download 1099 forms for your records
    • E-File your forms
  • You are required by IRS to e-file if you need to submit over 250 1099-MISC forms.
  • Even if you opt for e-file, you still need to provide printed copies of 1099-MISC to you vendors (can be on plain paper).
  • When you E-file, you no longer need to submit 1096 to the IRS.
How to
  • These are the first two things that you need to check when troubleshooting 1099 print issues.
    • Make sure the printer is turned on.
    • Print test forms before using the actual forms to check and ensure alignments are ok.
  • For instructions on how to print 1099, refer to Print 1099-Misc forms
  • No fees. You just need to buy pre-printed form since IRS doesn’t accept forms on plain paper. You can order it through the Intuit Marketplace. Local office supply stores like Best Buy and Office Depot also offers 1099 and other IRS tax forms.
  • Fees apply.