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gtalovic
Level 1

Where do I change a contractor/vendor from 1099-MISC to 1099-NEC? The system knows the difference as it shows who is NEC and who is MISC on the "over threshold" report

Where do I change a contractor/vendor from 1099-MISC to 1099-NEC?
13 Comments
JasroV
QuickBooks Team

Where do I change a contractor/vendor from 1099-MISC to 1099-NEC? The system knows the difference as it shows who is NEC and who is MISC on the "over threshold" report

You can change your contractor or vendor to 1099-NEC when preparing their 1099, @gtalovic.

 

I’d be glad to guide you on how to achieve this in your QuickBooks Online (QBO) account. Here’s how:

 

  1. Go to the Workers or Payroll menu (Or select Expenses and then Vendors).
  2. Select the Contractors tab.
  3. Click Prepare 1099s and select Let’s get started.
  4. Ensure your company name, address, and tax ID is correct and matches the letters from the IRS.
  5. Select the Nonemployee compensation box represent the type of payments made to your contractor this year. 3.JPG
  6. Fill in the needed details and ensure the mapping of your 1099 is accurate.
  7. Once done, you're now ready to file your 1099 forms.

For more details about this, you can check out this article for reference (read Step 3: Create your 1099s in QuickBooks Online section): Create and file 1099s using QuickBooks Online.

 

To learn more about the difference between 1099-MISC and 1099-NEC, you can refer to the links below that provide the complete details:

In case you made some errors or mistake in filing your Forms, you can utilize this resource that can guide you on how to handle the situation seamlessly: Correct errors on Forms 1099-MISC.

 

You’re always welcome to get back to me if you have other queries about preparing your 1099. I’d be more than happy to work with you again. Keep safe and take care.

suzymassel17
Level 1

Where do I change a contractor/vendor from 1099-MISC to 1099-NEC? The system knows the difference as it shows who is NEC and who is MISC on the "over threshold" report

I have the same question, but for QB Desktop!

suzymassel17
Level 1

Where do I change a contractor/vendor from 1099-MISC to 1099-NEC? The system knows the difference as it shows who is NEC and who is MISC on the "over threshold" report

I have the same question, but for QB Desktop!

MaryLurleenM
Moderator

Where do I change a contractor/vendor from 1099-MISC to 1099-NEC? The system knows the difference as it shows who is NEC and who is MISC on the "over threshold" report

I got you covered, suzymassel17.

 

To achieve this in QuickBooks Desktop, we need to adjust your Chart of Accounts. This is to ensure accounts are set up on each form. By adding a new account to your chart of accounts, we can track the payment separately. Here's how: 

  1. Go to the Lists menu, then choose Chart of Accounts.
  2. Click the Account dropdown, then choose New to create a new account.
  3. Choose an account type of Expense, Other Expense, or COGS, then click Continue.
  4. Enter the Account Name and details such as DescriptionNote, and Tax-line Mapping.
  5. Select Save & Close.

You can follow the same process for each new account to report on the 1099-NEC.

 

Then, we need to add a journal entry to move the amounts to the new account. For more details, you can check out Step 4: Move the payments to the new account outlined in this article: How to modify your chart of accounts for your 1099-MISC and 1099-NEC filing.

 

Lastly, I recommend visiting the links below to help you in preparing your company and tax forms for the upcoming 2020 tax season:

I'll be here if you have additional questions.

suzymassel17
Level 1

Where do I change a contractor/vendor from 1099-MISC to 1099-NEC? The system knows the difference as it shows who is NEC and who is MISC on the "over threshold" report

I am curious why I cannot just Edit my Account?  Why do I have to make a new Account?  My Account is for Independent Contractors.  Why can't I just Edit that account? 

suzymassel17
Level 1

Where do I change a contractor/vendor from 1099-MISC to 1099-NEC? The system knows the difference as it shows who is NEC and who is MISC on the "over threshold" report

How do I make sure the new Account will be reported on the 1099 NEC?  Why can't I just Edit the Account I need to report on the 1099 NEC?  

CharleneMae_F
QuickBooks Team

Where do I change a contractor/vendor from 1099-MISC to 1099-NEC? The system knows the difference as it shows who is NEC and who is MISC on the "over threshold" report

Thanks for getting back to us, suzymassel17.

 

The 1099 NEC and 1099 MISC should be mapped into separate accounts so they won't mix up in the tax forms.  The IRS separates the non-employee compensation into a new form. We'll have to track the transactions separately by creating a new account.

 

I recommend following the steps outlined by my colleague to create a new 1099-NEC account, then move the payments to the account to ensure they'll be reported.

 

For more information about 1099 forms and how to file them, I suggest checking this article: What is a 1099 and do I Need to File One?.

 

Additionally, 

I'm adding these articles for further details about the 1099-NEC FAQ and various updates in QBDT. 

 

 

Let me know if you have other questions about 1099. I'm here to assist you.

BethJep
Level 1

Where do I change a contractor/vendor from 1099-MISC to 1099-NEC? The system knows the difference as it shows who is NEC and who is MISC on the "over threshold" report

What if we only send out 1099 NEC's?  We don't need both misc and nec.  Can't we just make a simple change for that?  Instead of creating new accounts etc.?

ZackE
QuickBooks Team

Where do I change a contractor/vendor from 1099-MISC to 1099-NEC? The system knows the difference as it shows who is NEC and who is MISC on the "over threshold" report

Welcome to the Community, BethJep.
 

If you paid anyone $600 or more, you're required by U.S. tax law to file a 1099-MISC form. Payments found on these forms are geared towards vendors, attorneys, and other individuals who aren't proper contractors.


Since you only need to generate 1099-NEC forms, you'll want to access your Categorize payments to contractors screen and confirm all of the appropriate checkboxes are selected.
 

Here's how:

  1. In your left navigation bar, go to Payroll, then Contractors.
  2. Click Prepare 1099s.
  3. Hit Let's get started.
  4. Make sure the company name, address, and tax ID are correct.
  5. Tick all of your relevant checkboxes for each type of payment you've made.
  6. Enter any other necessary information to ensure the proper mapping of your forms.


Once you're finished, you'll be able to find a few useful articles about creating/filing, understanding payment categories, and correcting errors on forms in JasroV's post. Our help article archives also have many extensive resources that may come in handy moving forward.
 

Please feel more than welcome in sending a reply if there's any additional questions. Have a wonderful day!

BethJep
Level 1

Where do I change a contractor/vendor from 1099-MISC to 1099-NEC? The system knows the difference as it shows who is NEC and who is MISC on the "over threshold" report

We don't use the Payroll option though.   Is there another way?

Tori B
QuickBooks Team

Where do I change a contractor/vendor from 1099-MISC to 1099-NEC? The system knows the difference as it shows who is NEC and who is MISC on the "over threshold" report

Good morning, @BethJep

 

Thanks for following up with us. I'm happy to lend a helping hand with filing your 1099s without a payroll service. 

 

If you don’t have payroll, you can use the standalone 1099 e-file service to file the 1099-NEC with the IRS. You'll only need to ensure you've added your contractor and payment information to create and e-file 1099s. Then, once they're completed, you can email them or print and mail them. I've included the steps to do this below. 

 

  1. From the 1099 E-File Service page, log in to your or sign up for your account.
  2. Hit Enter information.
  3. Enter your company information, then tap Continue.
  4. Type in your tax information, then click OK.
  5. Enter your contractor information and values for the supported boxes, then select OK.
  6. Review your 1099 forms. Hit Add to continue adding more contractors, Edit to make any changes, or Continue to proceed to the next step.
  7. On the Pay for Service window, enter your credit card information and tap Approve to pay for the service.
  8. Select the Print For Contractors or Print for your records buttons to view and print 1099 forms.
  9. Place a checkmark next to contractors paid in prior years you also wish to create 1099s for. Click on Continue.
  10. If you are ready to e-file, select Submit final forms.

That's all there is to it! Check out Create and file 1099s using Intuit Online Payroll or no payroll for more details.

 

Please let me know if you have additional questions or concerns. I'll be here every step of the way. You can reach out to the Community or me at any time. Take care and have a great week! 

 

 

 

 

AngelaGoodner
Level 1

Where do I change a contractor/vendor from 1099-MISC to 1099-NEC? The system knows the difference as it shows who is NEC and who is MISC on the "over threshold" report

I don't have those options in my QBO account.  All my 1099s need to be NEC this year, and the e-file program is automatically putting them all in MISC without any input from me.  How do I set up this expense type to be seen as reporting to NEC?

MaryLandT
QuickBooks Team

Where do I change a contractor/vendor from 1099-MISC to 1099-NEC? The system knows the difference as it shows who is NEC and who is MISC on the "over threshold" report

Allow me to provide the steps so you can file 1099-NEC forms, AngelaGoodner.

 

You need to modify the Chart of Accounts to ensure those contractors' payments are tracked correctly for the form to use. Let me guide you through the steps:

 

Step 1: Create a 1099 Transaction Detail Report to identify the amounts paid and to which accounts.

 

  1. Go to Reports.
  2. Search for the 1099 Transaction Detail Report.
  3. Run the report and verify the amounts are showing in the correct accounts for the 1099-NEC and 1099-MISC. This will allow you to map the accounts as you go through the 1099 process.

You can also use the 1099 Contractor Balance Detail or 1099 Contractor Balance Summary reports if either of them adds more information.

 

Step 2: Add a new account to track separate payments.

 

  1. Go to Settings ⚙, then select Chart of Accounts.
  2. Click New.
  3. From the Account Type ▼ drop-down menu, select the type of account, Expense, Other Expense, or COGS.
  4. From the Detail Type ▼ drop-down, choose the one the fits the transactions
  5. Give your new account a name. 
  6. Add a description.
  7. Click Save and Close.
  8. Repeat this process for each new account to be reported on the 1099-NEC or 1099-MISC.

Once done, you can follow Step 3 and 4 through this article: How to modify your chart of accounts for your 1099-MISC and 1099-NEC filing. Then, choose QuickBooks Online for instructions and detailed steps.

 

Once these steps are completed, you are ready to begin filing your 1099-MISC and 1099-NEC forms.

 

If you're done mapping the accounts and 1099-NEC is still not generating, I recommend contacting our Live Support Team. They can verify the set up of your accounts and track payments correctly.

 

Stay in touch with me if there's anything else you need while preparing your 1099s. I'll be right here to help you if you need anything else concerning payroll.

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