Preparing multiple Form 1099s for year-end is a time-consuming task for your company’s payroll department. To speed up and simplify the process, QuickBooks® has a 1099 Wizard* feature that can save your staff and CPA time and money.
QuickBooks 1099 Wizard
After a little bit of setup, the QuickBooks 1099 Wizard tool can greatly decrease the amount of time it takes to identify 1099 vendors and amounts paid to them. If a 1099 is to be issued for a particular vendor; double click on the vendor to access the setup screen, click on the Tax Settings tab to check the box for “1099 Vendor”, and enter the vendor’s tax ID. This can also be accessed under the Vendor Tab, then “1099 Wizard”. QuickBooks will also separate amounts paid by cash or check from amounts paid by credit card, as payments made by credit card are already reported using Form 1099-K provided by the vendor’s credit card processing company.
The best way to obtain vendor information, such as entity type and tax ID, is to request the vendor fill out a W-9 Form. Instead of frantically trying to track down vendors and the forms at year-end, it would be beneficial to get the W-9 filled out by the vendors at the time of service. Many vendors already have this form filled out and will send you a copy. If not, blank W-9 Forms can be found on the IRS website.
Even though QuickBooks has these helpful tools, the rules for filing 1099s can be very confusing and the penalty for not filing can be huge; it is best to consult with a tax advisor to avoid any hassles that come from not filing properly. Keep in mind, the deadline to file 1099s is January 31. Contact an Anders advisor with any questions.
*Please note: For QuickBooks Online, the 1099 Wizard feature is only available with the Plus versionAll Insights