1099 Filing Season is Upon Us – What You Need to Know

Form 1099 season is quickly approaching, and now is the time to check the boxes and make sure your business is ready for a quick and painless filing in January.

1099’s report non-employee compensation to vendors who provide services such as independent contracting, consulting, attorney services, rents, royalties, commissions and much more.

Does Your Business Have to File 1099-MISC and/or 1099-NEC?

  • The answer is YES if you made any payments of at least $600 to any non-corporate vendors or contractors. Visit the IRS website for definitions, exceptions and specifics.

Do You Have What You Need To Prepare the 1099s Timely and Accurately?

  • Accurate records are critical when working with contractors. Maintain a current, signed W9 for each vendor noted above. A W-9 form provides their name, address and taxpayer information like a Social Security or Employer Identification number. Start requesting and gathering any missing information sooner rather than later.

Updates to Form 1099

As a reminder, in 2020 we saw the addition of Form 1099-NEC:

  • Form 1099-NEC (Non-Employee Compensation) is used to report payments made over $600 to nonemployees, independent contractors and vendors.
  • Form 1099-MISC (Miscellaneous) is used to report other miscellaneous payments, including royalties, rents, medical payments and payments to attorneys.  
  • The fourth quarter is the perfect time to make sure you have up-to-date W-9s on record for your 1099 recipient vendors, and request missing information. Review vendor expense coding so that you can properly prepare and file your 1099’s at year-end, avoiding mistakes and scrambling at the last minute. The filing deadlines come quickly after year end; be prepared to file accurate, timely forms for your vendors, and avoid costly fines and penalties. Filing your 1099s electronically is the easiest and most cost-effective method to meet your filing requirement. 

Anything New in 2022?

In Form 1099-MISC, some boxes have been renumbered to accommodate a checkbox for the Foreign Account Tax Compliance Act (FATCA) Filing Requirement. 2021 Boxes 13-17 have now been renumbered to Box 14-18 as a result.

2022 1099-MISC Deadlines

  • Recipient copies – January 31, 2023
  • Paper filing – February 28, 2023
  • E-filing – March 31, 2023

Forms 1098, 1099-A, 1099-C, 1099-DIV, 1099-G, 1099-INT, 1099-K, 1099-MISC, 1099-NEC, and 1099-S have been converted to a continuous use form – meaning the IRS does not anticipate annual changes going forward. There are no substantive changes to the form or instructions for the year 2022.

2022 1099-NEC Deadlines

  • Recipient copies – January 31, 2023
  • Paper filing – January 31, 2023
  • E-filing – January 31, 2023

Author: Laura Whitman, CPA

Contact Us

Contact Withum’s Outsourced Accounting Systems and Services Team if you have any questions or need assistance with 1099s.