If you run a business and hire freelancers or pay your contractor by check, cash, or direct deposit, you very well know that you must file a 1099 tax form with the IRS. It is a document referred to as “information returns” and belongs to Internal Revenue Service. While filling out this form can be tricky, you can easily file 1099 in QuickBooks Desktop electronically with the already saved records in your account. Its features allow you to create 1099 in QuickBooks Desktop hassle-free and save you from the tiring process of filling them online and sending them to the IRS after printing via post. Additionally, you can also directly email them to your contractors or print and send them via mailing services. This article will assist you in how to file 1099 in QuickBooks Desktop.
Let’s briefly understand the process of how to create and electronically file 1099 in QuickBooks Desktop.
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Who Needs to File 1099 in QuickBooks Desktop?
There are two types of Form 1099. One is 1099-NEC, and the other is 1099-MISC. The 1099-NEC is a form filled by the business if they hire any independent contractor, gig worker, or self-employed individual on a contract basis and pay them more than $600 in a year.
However, Form 1099-MISC is a form that is filled if a business pays an individual or LLC at least $600 during a year as a rental, legal settlement, prize, or award-winning. You can easily create both of these in the QuickBooks Desktop application and can E-file 1099 in QBD.
Additionally, if you are someone who has made multiple types of cash payments to your non-employees, you would need to categorize the contractors on the basis of payment type properly, and you would be required to fill both 1099-NEC and 1099-MISC.
In such a case, if you have to file both the 1099 forms for the same vendor, you need to create a new ledger expense account for the vendor, which will report on 1099-NEC. Because a single account can only be used for one form. To do this, go to the Accounting tab in your QuickBooks Online and navigate to the Account section. Now, click New and Select an Account Type, Detail Type, and enter a Begining Balance, if there is one. Now, Save and Close once finished. You can also edit the vendor payments to move them from one general ledger account to another.
How to Create & Electronically File 1099 in QuickBooks Desktop?
Once you have created the general ledger account for your vendors, you can create a 1099 in QuickBooks Desktop and e-file 1099 in QBD for all of your vendors. Let us understand how to do that in the next part of the article.
Step 1: Create 1099 in QuickBooks Desktop
You can create 1099 in QuickBooks Desktop and either print it, manually file it and send it to the vendor or directly e-file 1099s in QBD. In addition, you need to perform the following steps to create 1099 in QuickBooks Desktop.
- Open your QuickBooks Desktop application and navigate to the Vendors.
- From there, select the 1099 Form.
- Now, click on Print/E-file 1099 Forms.
- Tap on Get Started and select 1099-NEC or 1099-MISC, depending upon the type of your contractors. You need first to create 1099-NEC and then 1099-MISC with the same steps as the previous one.
- Now, select all the vendors and contractors for whom you want to create 1099 in QuickBooks Desktop.
- You can double-click to verify and edit your vendor information before hitting continue. Hit Continue once done with all the verification.
- Now, click Apply payments in this 1099 box section and navigate the dropdown menu.
- Select the vendor accounts you want to link to the particular payment. If you see the box in Gray color, it is already linked to another 1099 form.
- In case you encounter an error message saying that your setting doesn’t match the current IRS threshold, tap on Show IRS 1099-MISC filing threshold and click on the Reset to IRS Thresholds.
- To check and view the detailed reports of the included or excluded payments in form 1099, click on View Excluded Payments or View Included Payments. (You can also remove any transaction from the 1099 form at this point.)
- Lastly, review the vendors and the transactions that you are going to report and select Continue.
- You will get two options: print or e-file 1099sin QBD.
- If you wish to print, select the Print option, and to electronically file 1099 in QuickBooks Desktop, follow the steps mentioned in the next section.
Read Also- QuickBooks Payroll Tax Table Update
Steps 2: Import Data into Tax1099
Before you proceed to e-file 1099 in QuickBooks Desktop, you need to import data through an integration called Tax1099. Follow these steps to import data to Tax1099.
- Open QuickBooks Desktop and navigate to Go to 1099 E-file Service.
- You will land on the Tax1099 landing page.
- Sign-up or Log in to your Tax1099 account.
- After you have logged in, follow on-screen instructions to import your data prep[ared into QuickBooks Desktop into Tax1099.
- Once it is successfully imported, the Tax1099 dashboard will show you the list of vendors, amounts, and boxes.
- Follow the next step to e-file 1099 in QuickBooks Desktop.
Step 3: Electronically File 1099 in QuickBooks Desktop
These are the standard steps to file both 1099-NEC and 1099-MISC in QuickBooks Desktop. Follow the given steps to e-file 1099s in QBD.
- Click on the Edit button or Select vendor name to update any information.
- Fill in the information under suitable state boxes to e-file 1099s with your state.
- Check the boxes next to the Date column for all the vendors you want to e-file for and hit Next.
- You will get three options to choose from on how you want to send the copies to the recipients:
- USPS mail (you need to pay an extra charge for this),
- Email Recipient,
- Download PDF, and Send Manually.
- Select anyone according to your preference.
- If you want to file 1099s with your state, select them here and click Next.
- Once done filling in all the required information on the Select Forms screen and selecting all the appropriate options, you will be redirected to the Payments Page.
- Enter your payment information and tap on Pay & Submit to e-file.
- Repeat the same steps to create and file 1099-MISC.
Step 4: Check the Filing Status for Form 1099s
Once done with filing Form 1099s for all your vendors, you can check the filling status by logging into your Tax1099 account. Follow the given steps to check the status:
- Log in to your Tax1099 account from QBD.
- On the upper right corner of the page, look for the + Sign and Click on it.
- Click on the Check on Status option.
- Enter your 9-digit reference number.
- Tap on the Check Status.
Read also – How to E-File W-2s With Quickbooks Desktop
Is it worth the Hype to E-file Form 1099 in QuickBooks Desktop?
The main reason why you should file 1099 in QuickBooks Desktop are:
- It is hassle-free and easy to use: If you file 1099s using QuickBooks Desktop, you can save time and effort in filling the form as it uses the already saved data from the account to file it electronically. You can directly import your data from QuickBooks and e-file1099s in QBD.
- It saves you from manual work: AS discussed earlier, there are two ways to create and file From1099 for non-employee wages. The first is to do manual work, purchase the 1099 kit, fill it up manually, and send it to IRS, and the other is a straightforward way, i.e., to E-file Form 1099 in QuickBooks Desktop application. The second option can save you from a lot of manual work as you can directly create and file Form 1099 in QBD and email them to your contractors. Also, you can download and send the copies also.
The Final Note
QuickBooks is just the right way for you to file Form 1099 with ease. Additionally, QuickBooks also informs you from time to time about the changes made by the federal government regarding Form 1099s. For the time being, follow the steps mentioned above to file 1099 in QuickBooks Desktop, and in any case, if you need help, try contacting us.
Still having issues? Call us at +1-(855)-955-1942
Frequently Asked Questions
Yes, you can do another set of QuickBooks1099 filing if you already have filed 1099s in QuickBooks. All you need to do is file 1099s for a separate company. You just log in to that company in QB Online and follow the same steps as previously done.
To get the 1099 Reports after e- filing 1099 in QBD, go to the Business overview and then choose the Reports option. After that, tap on Customize option and under the Rows/Columns listing, select the Change columns. Then, choose the Track 1099 checkbox and then select Run Report.
If you need to make changes or corrections to your 1099 after filing 1099s using QuickBooks Desktop, you will need to work directly with the IRS. You need to follow the IRS instructions to do so.