Tag Archive for 1099-NEC

Businesses Have Feb. 1 Deadline To Provide Forms 1099-MISC And 1099-NEC To Recipients

Forms 1099-MISC and 1099-NEC

The Internal Revenue Service reminds businesses and other payors that the revised Form 1099-MISC, Miscellaneous Income PDF, and the new Form 1099-NEC, Nonemployee Compensation PDF, must be furnished to most recipients by February 1, 2021.

Redesigned Form 1099-MISC

The IRS revised Form 1099-MISC for the 2020 tax year to accommodate the creation of a new Form 1099-NEC. The redesigned 1099-MISC has different box numbers for reporting certain income. Businesses must send Form 1099-MISC to recipients by February 1, 2021, and file it with the IRS by March 1 (March 31 if filing electronically).

If businesses are using Forms 1099-MISC to report amounts in box 8, Substitute Payments in Lieu of Dividends or Interest, or box 10, Gross Proceeds Paid to An Attorney, there is an exception to the normal due date. Those forms are due to recipients by February 16, 2021.

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NEW IRS Requirements: 10 Fast Facts About The 1099-NEC

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The IRS has made a major change that could affect your information returns reporting for the upcoming season. Form 1099-NEC is taking the place of what used to be recorded in box 7 of Form 1099-MISC. Typically, this form is issued to contractors, janitorial services, third-party accounts and any other worker paid for services who is not on the payroll. Following are key points about this new form.

  1. The 1099-NEC must be used for the 2020 tax year and beyond. In other words, your independent contractors will now receive Form1099-NEC.
  2. NEC stands for Nonemployee Compensation. The new 1099-NEC is based on an old form that has been out of use since 1982. The IRS revived the form to address some time-management and administrative issues that arose under the Protecting Americans from Tax Hikes Act of 2015 (PATH Act). The new Form 1099-NEC effectively separates certain data from Box 7 of the 1099-MISC, in addition to staggering the filing due dates.
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Written by | Posted in 1099-NEC • eFile4Biz