1099 Changes Starting 2020
File Form 1099-MISC for each person to whom you have paid the following during the year:
- At least $10 in royalties or broker payments in lieu of dividends or tax-exempt interest.
- At least $600 in:
- Prizes and awards
- Other income payments
- Medical and health care payments
- Crop insurance proceeds
- Cash payments for fish (or other aquatic life) you purchase from anyone engaged in the trade or business of catching fish
- Generally, the cash paid from a notional principal contract to an individual, partnership, or estate
- Payments to an attorney
- Any fishing boat proceeds
In addition, use Form 1099-MISC to report that you made direct sales of at least $5,000 of consumer products to a buyer for resale anywhere other than a permanent retail establishment.
File Form 1099-NEC, Nonemployee Compensation (NEC), for each person in the course of your business to whom you have paid the following during the year:
At least $600 in:
Services performed by someone who is not your employee (including parts and materials) (box 1);
Cash payments for fish (or other aquatic life) you purchase from anyone engaged in the trade or business of catching fish (box 1); or
Payments to an attorney (box 1). (See, later.)
You must also file Form 1099-NEC for each person from whom you have withheld any federal income tax (report in box 4) under the backup withholding rules regardless of the amount of the payment.
Vendor File Maintenance
3. Company Address 1 - Enter the company address as you wish it to appear on the 1099 forms.
4. Company Address 2
5. City, St Zip - Enter the company city, state, and zip code as you wish it to appear on the 1099 forms.
This information must be entered according to the following format.
City, St Zip Pomona, CA 91766
Please make sure to place a comma (,) between the city and abbreviated state.
6. Company Phone No. - XXX XXX-XXXX
7. 1099 Category - 1099-NEC is designed to replace Box 7 of the original 1099-MISC form. So it is likely you will enter "7" in this field. On the other hand, 1099-MISC will continue handle the following 1099 Categories: 1, 2, 3, 4, 5, 6, 8, A, D and E. However, since vendor 1099 category is a free form field, if the value is not part of this list, then it is assumed to be printed on 1099-NEC even if the value is not "7". For example, user commonly mistakenly enter "Y" to vendor's 1099 category to indicate "Yes to print on 1099." But "Y" does not correspond to any 1099-MISC form's box. So Elliott assumes "Y" means box 7 and hence to be printed on 1099-NEC with this update. You can simply enter "Y" here to print those vendors' 1099 category = "Y".
8. Starting Vendor No - Enter the starting vendor number in the range that you want to print. The default is All vendors.
9. Ending Vendor No - Enter the ending vendor number in the range that you want to print. The default is the starting vendor number to make it easy to print a 1099 form for one vendor.
10. Cut Off Amount - This is the cut‑off amount of vendor YTD payments to be reported.