When I run the 1099 report, I have a vendor who doesn't show up anywhere. She is listed as a 1099 vendor and her payment is in a 1099 account and it is over the $600 threshold. The only thing I could think of that it could be is that we paid her via credit card. I did a workaround of creating checks for the correct amounts and dates so that I could create the 1099 and then deleting them after the 1099 was created. Any ideas on how to get her to show up in the correct report?
Solved! Go to Solution.
There is a BIG problem with this as the vendor only gets a 1099 K if they have over 20,000.00 in payments and 200 Transactions, See paste from my merchant account below.
The 1099-K is generated through the credit card company (VISA AMEX MC). They send out 1099-K's so we do not send the vendor a 1099-M or NEC since their income is reported through a 1099-K. So any vendors you pay with a credit card gets their income reported by a 1099-K sent to them by the credit card processor and you do not send them a 1099 so those payments will not show up on your 1099 report.
UMMMM... Let's talk real world here...
Most small business owners look every single day as to where they're going to find money for this and that and they constantly turn to their credit cards for last minute hopes and prayers to pull them through the week. If for whatever reason they need to pay a subcontractor once or twice via a credit card or multiple credit cards for that matter and for less than a few hundred dollars at that, there is no way these figures are going to be captured or reported by the credit card company. The subcontractor turns to the small business owner for a correct 1099 and will not chase the credit card company for the missing pieces.
The problem is, the business owner, simply reacts under pressure.
I have been advising my clients to simply take a cash advance so we can book it to a cash advance account. Then from there expense it out to the subs. Then they'll show up in the 1099 reports as expected.
I would like to say this is absolutely incorrect, another Intuit boboo. It's totally unrealistic for a credit card company to know which are 1099 vendors and which payments to them might be subject to receiving a 1099, and actually filing a 1099. I have clients who have multiple credit cards and pay the same vendor with more than one card.
My clients use QB desktop. Why should they have to jump through hoops to prepare a report required by the IRS? It almost looks like the intent is for those with an Intuit merchant services account, but that's backwards because the business would be receiving payments, not paying vendors.
I hope someone from upper level QB development sees this and gets it corrected. Kudos to Budget Friendly Bookkeeping, this is the real world, not an Intuit fantasy world