With the end of the year quickly approaching, now is the time to start thinking about preparing for a smooth 1099 filing season. We all know that accurate records are essential for preparing the forms correctly, so it’s imperative to review your information now. This is the perfect time to ensure you have accurate W-9s on record, to review your accounting records to ensure expense coding is accurate and to request any information that may be missing.
There will be a new 1099 form (1099-NEC) for 2020. What does this mean for you?
- Form 1099-NEC (Nonemployee Compensation) will be used to report current and deferred compensation to nonemployees in Box 1.
- Non-employee compensation will no longer be reported on 1099-MISC in box 7.
- Form 1099-MISC will continue to be used to report other miscellaneous income, such as rent, royalties, attorney payments, and medical payments.
- Boxes on 1099-MISC will be different for 2020; read and review the instructions carefully to ensure you are reporting the affected items correctly.
- Forms 1099-NEC are due 02/01/2021, and Forms 1099-MISC are due 03/31/2021.
For more tips on preparing for a seamless filing process, please reach out to us.