When you pay your contractors using a check, direct deposit, or cash, you need to file 1099 tax forms with the IRS. QuickBooks Desktop helps you prepare and file 1099 forms from the records you have already saved in your accounts. The software features 1099 file creation capability to save you time and effort in creating 1099s for filing them online or printing them for sending to the IRS via postal services. Also, you can email copies of 1099s to your contractors or print them to send via a mailing service. This article will assist you to create and file 1099s with QuickBooks Desktop. Before we move ahead with the procedure to create and file 1099 with QuickBooks, let’s discuss the software in brief.
Why Most American Businesses Use QuickBooks?
QuickBooks Desktop is designed to simplify accounting, bookkeeping, invoicing, and a number of processes related to your transactions with customers, vendors, employees, banks, and even tax regulators. It streamlines accounting tasks for you so that you can focus on creating strategies to market your products and growing your business, rather than losing your productive time in just tracking and managing your income and expenses. Though QuickBooks is an accounting application, it offers great time-saving features for invoicing, inventory management, end-to-end order processing, analytics, reporting, and tax compliance.
How to Prepare 1099 Tax Forms with QuickBooks Desktop?
The procedure to create 1099s in QuickBooks Desktop involves the following steps.
- Start QuickBooks and go to Vendors.
- Select 1099 Forms.
- Click on Print/E-File 1099 Forms.
- Click on Get started and select 1099-NEC or 1099-MISC depending upon the type of your contractors.
- Select vendors who need 1099 and click on Continue.
- Check whether vendor information is appropriate. You can update any section by double-clicking on it and editing the incorrect fields. Once verified, select Continue.
- Click on the Apply payments to this 1099 box dropdown. Select the vendor accounts you want to map. If you see that a box is gray, it is mapped to the other 1099 form. Every vendor account can be mapped to one 1099 form. When done, click on Continue.
- If you encounter an error message prompting that your settings don’t match the current IRS thresholds, click on Show IRS 1099-MISC filing thresholds and select Reset to IRS Thresholds.
- Verify your payment details for exclusions and select Continue.
- Review the vendors and transactions you are going to report. Select Continue.
- Select whether to print or e-file 1099 forms. If you want to e-file 1099 forms, the steps to do that are as mentioned in the next section.
How to E-File 1099 with QuickBooks Desktop?
E-filing of 1099 forms is enabled in QuickBooks Desktop through an integration called Tax1099. After creating your 1099 forms in QuickBooks Desktop, you need to import your data into Tax1099. In QuickBooks Desktop, click on Go to 1099 E-file Service. It takes you to the Tax1099 landing page. Log into your Tax1099 account or sign up if you don’t have an account already. Once you log in, Tax1099 helps you decide how to import your records from QuickBooks Desktop. Follow the wizard to import your data. Once you have successfully imported your data, you will find that the Tax1099 dashboard is showing the list of vendors, amounts, and boxes. Now, follow the below steps to e-file your 1099s.
- If you want to update information, click on the Edit button, or select the vendor name.
- If you want to e-file 1099s with your state, fill in the information under suitable state boxes.
- Select the vendors you need to e-file for by checking the box, and then select Next.
- Select the vendors by clicking on the box next to the Date column.
- Select the box under USPS Mail or Email Recipient depending upon how you want to send copies to the recipients. However, there is an additional fee for selecting USPS Mail.
- You can optionally download PDFs to provide vendors their copies yourself.
- If you need to file 1099s with your state, select them here, then click on Next.
- Once you have selected all the appropriate options and entered the required information on the Select Forms screen, you are taken to the Payment page.
- Enter your payment information and select Pay & Submit to e-file.
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