As the end of the year approaches, many accounts payable departments are gearing up to complete their annual Form 1099 filings. For 2020, a new form, Form 1099-NEC, will be used to report payments of non-employee compensation to vendors. (See earlier coverage.) The IRS resurrected the Form 1099-NEC, which had not been used in decades, to replace Box 7 reporting on Form 1099-MISC because the Protecting Americans from Tax Hikes (PATH) Act accelerated the filing deadline for non-employee compensation to January 31. The rules for reporting on Form 1099-NEC are generally the same as for reporting in Box 7 of Form 1099-MISC in the past. However, the reporting requirements for the two may differ at the state level.
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Form 1099-NEC
IRS Plans to Resuscitate Long-Dead Form 1099-NEC
Posted in Information Reporting, IRS
In the category of “everything old is new again,” the IRS announced in late July that it intends to require that nonemployee compensation (“NEC”) paid during the 2020 calendar year be reported on new Form 1099-NEC, instead of being reported in Box 7 of Form 1099-MISC. A draft of Form 1099-NEC was posted on the IRS website for public comments, which are due by September 30. The change comes in response to statutory changes made in 2015 by the Protecting Americans from Tax Hikes (PATH) Act.…
Continue Reading IRS Plans to Resuscitate Long-Dead Form 1099-NEC