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Cody4533
Level 1

Paying non-1099 vendors with direct deposit

Can I use vendor direct deposit for vendors that are not 1099? Thanks. 

9 Comments
Anna S
QuickBooks Team

Paying non-1099 vendors with direct deposit

Hi there, @Cody4533.

 

Allow me to provide some more information about vendor direct deposits.

 

When you use vendor direct deposit, you're paying the vendor and recording the transactions to calculate their 1099s. This means you'll want to pay the vendor that doesn't have 1099 using another form of direct deposit. You'll also want to send the payroll to Intuit before 5 p.m. Pacific Time, two federal banking days before the paycheck date to ensure it processes on time. You can check out this article for more information: Send payroll and direct deposit paychecks.

 

Feel free to drop a line below if you have any other questions. I'm always here to help.

Cody4533
Level 1

Paying non-1099 vendors with direct deposit

Thank you for your response Anna.I use direct deposit for employees' payroll. Is ACH a payment option since Intuit does not allow direct deposits to non-1099 vendors? Due to the COVID-19 pandemic, some of my non-1099 vendors would prefer to get paid electronically so they don't have to rely on the mail and the going to the bank to deposit their monthly check. 

Candice C
QuickBooks Team

Paying non-1099 vendors with direct deposit

Good Evening, @Cody4533

 

Thanks for reaching back out to the Community. There are two options available for you to pay your vendor(s). Either by check or credit card. Here's how to get there: 

  1. Go to the Vendors menu. 
  2. Choose Pay Bills
  3. Check the bills you'd like to pay. 
  4. In the payment section, press the Method drop-down arrow and select either Check or Credit Card
  5. Once you're finished, hit Pay Selected Bills

Here are two additional links that could help you out if you have a 1099 Vendor that you'd like to pay with direct deposit:

Should you need any further assistance, don't hesitate to contact me. I'm always here to lend a helping hand. Have a great week ahead!

user04858
Level 2

Paying non-1099 vendors with direct deposit

I have non-1099 vendors whom I am now paying via bank domestic wire which incurs hefty bank charges at my side as well as my vendors’ bank. I do not have ACH with my bank now. Can I use QBO direct deposit to pay these non-1099 vendors?

IamjuViel
QuickBooks Team

Paying non-1099 vendors with direct deposit

Hello, @user04858.

 

Yes, you can use direct deposit to pay your mom-1099 vendors. Here are some factors you need to consider:

  • The direct deposit set-up is complete.

  • You have 1 bank account assigned to use for all DD transactions only. The use of different funding bank accounts is not possible.

  • You have an active subscription to any version of QuickBooks Online Payroll. If you have inactive W-2 employees or no employees at all, you still need to have a subscription to pay contractors with direct deposit.

Here's how to pay your vendors:

  1. Go to the Workers menu and select Contractors.
  2. Click write a check drop-down menu on the contractor you'd like to pay and select Pay by Direct deposit.
  3. Enter the payment amount and select a Category for that payment.
  4. Choose a corresponding account in QuickBooks and click Pay.
  5. Click Yes, let's proceed.
  6. Click Close.

Here's an article you can read for more details: Contractor direct deposit.

 

Then, to pay your vendor via DD, I got you this great article for reference: Pay vendors using Direct Deposit.

 

We got your back if you have additional queries about it. Have a great day!

user04858
Level 2

Paying non-1099 vendors with direct deposit

Dear lamjuViel,

Thank you for taking time to reply my query.

I am on QBO Plus.

I understand how to set up Direct Deposit for a 1099 contractor.

I have a vendor who is not a 1099 contractor. This vendor does not appear in Workers>Contractors.

I find all QBO articles titled "pay vendors using direct deposit" are related to 1099 contractors or employees, not vendors who are non-1099 contractor. These articles are not helping with non-1099 contractors.

 

 

MaryLurleenM
Moderator

Paying non-1099 vendors with direct deposit

I appreciate your response, user04858.

 

Intuit's direct deposit service can't be used to pay bills or make payments to individuals who are not independent contractors. This is to meet Federal and State compliance requirements.

 

You'll want to consider using a third-party app, you can check Desktop Marketplace for supported apps.

 

Stay in touch with me if you need anything else.

TX_Summer
Level 1

Paying non-1099 vendors with direct deposit

Did you ever find a way to pay non 1099 vendors?

MaryAnn_E
QuickBooks Team

Paying non-1099 vendors with direct deposit

Hi there, @ TX_Summer.

 

If you have QuickBooks Online on paying the non-vendors, you can use the steps provided by @IamjuViel. You can use direct deposit to pay your non-1099 vendors.

 

If you have QuickBooks Desktop, you can follow @MaryLurleenM suggestion to check our  Desktop Marketplace for supported apps.

 

For more details about 1099, I recommend checking these articles: 

 

Please let me know if you have additional questions about QBO. I’ll be more than happy to assist further. Have a good one.

 

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