Preparing Your 1099s – Deadlines and Processes

First, we’ll ensure that your recordkeeping data is well categorized and that your payments to individual contractors are visible for external audits. Our specialists will catalog your financial recordkeeping data, analyze your QuickBooks file along with your CPA, and track your payment amounts. In the US, 1099 forms are generally required only if your calendar-year payments to individual contractors exceed $600. However, there are exceptions. Payments for corporations, for example, are exempted from 1099 reporting, even if the annual paid amounts surpass that sum. Likewise, payments toward merchandise, storage, and disbursements made to employees, which are reported on a W-2 form, are usually excluded from 1099 forms.

In addition, we will review your vendor’s list and leverage QuickBooks’s built-in tools to automatically determine which of your past contractor’s collaborations qualify for a MISC or NEC 1099 form. We will gather the necessary contact information for each contractor, choose the required box numbers for the MISC-type forms, offer training to your employees, and verify the documentation before it’s submitted to the IRS. Next, it’s up to you.  Do you want to streamline the submission process? If so, e-filling will be an advantageous choice.

Our bookkeepers will analyze the status of your payments, check whether the people with whom you collaborated are listed as independent contractors, and teach your employees how to map 1099 accounts in QuickBooks online. This is important, as misclassifications could lead to IRS penalties. Plus, we will double-verify the state-specific requirements for MISC and NEC 1099s. Texas is more lenient than other US states when it comes to tax returns, as it doesn’t charge an income tax. However, the complexity of the necessary forms might be too much for your employees. So, it would be best if you used our regionally renowned specialists.