LUTZ BUSINESS INSIGHTS
What is the form 1099-nec?
Form 1099-NEC is used to report Non-Employee Compensation payments previously reported in Box 7 on a Form 1099-MISC.
2020 Due Date: February 1, 2021, as January 31, 2021, falls on a Sunday for both the IRS and the recipient.
Include: All non-employee compensation paid in the amount of $600 or greater or for a recipient detailed in #4 below:
Box 1 Reporting:
- Services performed by someone who is not an employee (including parts and materials);
- Cash payments for fish (or other aquatic life) that the company purchases from anyone engaged in the trade or business of catching fish;
- Payments to an attorney of $600 or more paid in the course of the organization’s trade or business. The term “attorney” includes a law firm or other provider of legal services.
- Each recipient described in 1 – 3 above, regardless of amount of payment from whom the company withheld any federal income tax (withholding is reported in Box 4)
Box 2 and 3 are reserved for future use.
Two notable checkboxes:
- FATCA filing requirement- for further information https://www.irs.gov/forms-pubs/about-form-1099-ne
- 2nd TIN not: Payer may enter an “X” in this box if you were notified by the IRS twice within three calendar years that the payee provided an incorrect TIN, and the IRS will not send you any further notices about this account. However, if you received both IRS notices in the same year, or if you received them in different years, but they both related to information returns filed for the same year, do not check the box at this time. See part N in the 2020 General Instructions for Certain Information Returns for more information.
The new Form 1099-MISC: All other income typically reported on a 1099-MISC continues to be reported on Form 1099-MISC. On Form 1099-MISC, Boxes 7 through 17 have been shuffled. Box 1 “Rents” and Box 3 “Other Income” remain the same.
COVID-19 has changed the way we conduct/attend job interviews. Here are five things that pandemic interviews have taught us…
High-functioning families of wealth take a broad view of family capital, realizing the concept refers to so much more than just financial wealth. These successful enterprises are rich in family capital…
If you are an independent contractor and need to send invoices, QuickBooks provides the best tools for this task…
SIGN UP FOR OUR NEWSLETTERS!
We tap into the vast knowledge and experience within our organization to provide you with monthly content on topics and ideas that drive and challenge your company every day.