Changes to 1099 Forms for 2020
The IRS added an additional form to be used when filing 1099s for 2020 – Form 1099-NEC. The amount that used to be input in Box 7 Nonemployee Compensation on Form 1099-MISC is now reported on Box 1 Nonemployee Compensation on Form 1099-NEC. As a result, the account mapping in your QuickBooks file will need to be updated for the 1099 reports to be correct.
Note: the accounts shown are for example only – your accounts may differ in number and/or name.
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- Go to Edit menu – choose Preferences
- Click on Tax: 1099 in the left column
- Choose the Company Preferences tab
- Click “you can do it here” on the line for Form 1099-NEC and Form 1099-MISC to map accounts.
For Form 1099-NEC, the accounts that were previously assigned to Box 7 Nonemployee Compensation need to now be assigned to NEC Box 1: Nonemployee Compensation.
For Form 1099-MISC, the applicable accounts other than those used for Nonemployee Compensation need to now be assigned. The most common is MISC Box 1: Rent.
Run a 1099 Summary report to verify all the needed changes have been made. You will need to toggle between 1099 types to view each report.
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Go to the Vendors screen and choose Prepare 1099s.
Mapping the accounts can be done in the drop downs provided under each category.
The steps on the screens that follow will allow you to review the information to make sure everything is included. You can save and close the 1099 Wizard at any time to make any changes needed in the Vendor or Chart of Account area(s).
See all QuickBooks Tips here.
Questions on the new Form 1099-NEC form or account mapping in QuickBooks? Visit with one of our experts by calling (888) 388-1040.
