It is very normal for a business to hire an individual based on assignments. They are generally referred to as contractors by businesses. As per IRS norms, businesses must file Form 1099 for every individual contractor paid more than $600. QuickBooks allows users to Set Up 1099 Contractors and track their payments throughout the year. When filing taxes, you can directly check the status of your contractors for form 1099 if you have already set them up.
Do you want to set up a 1099 contractor? Go through this blog for simple solutions or reach out to an expert for step-by-step guidance. Call at +1(855)-856-0053.
Process to Set Up a 1099 Contractor
The method to set up a 1099 contractor requires you to add the contractor as a vendor in your books and then activate the tracking payments for 1099. The steps to do it is different for QuickBooks Online, QuickBooks Desktop for Windows, and QuickBooks Desktop for Mac. let’s look at the sites you are required to follow:-
Setting up Contractor in QuickBooks Online
Setting up a contractor in QuickBooks online is a two-step process. The detailed steps are as follow:-
Step 1- Adding the Contractor as Vendor
- Go on the Contractors menu and click Add a contractor.
- Enter in all the required information or select Email this Contractor checkbox.
Note:- Contractor can then fill out all the details themselves.
- Now tap on the Add contractor button after you are done.
Step 2- Activate Tracking Payments for 1099
- Go on the Vendors menu.
- Select your contractor from the lists and open their profile.
- Now click the edit button and tick mark Track payments for 1099 box.
Setting up Contractor in QuickBooks Desktop
The method to set up a contractor in QuickBooks Desktop involves activating the 1099-Misc feature and then adding your contractor as a vendor. These are the steps you need to follow:-
Step 1- Activate the 1099-MISC option
- Go to the Edit menu and select Preferences.
- Now tap on the Tax:1099 menu and go on the Company Preferences menu.
- Tao on Do you file 1099-MISC forms? And click on Yes.
- Finally, press the OK button to save your settings.
Step 2- Add Contractor as Vendor
- Click on the Vendors tab and select Vendor Center.
- Tap on the New Vendor list and press New Vendor.
- Now enter in all the required information.
- Type in all the required information about your contractor.
- Finally click on OK after you are done.
Step 3- Track the Contractor Payments for 1099
- Go to the Vendors menu and select Vendor Center.
- Select your vendor and press edit.
- Go to the Address Info menu and review the information you added. Make sure that correct state abbreviation, ZIP code, vendor’s name last name is added
Note: leave the company name section blank if you know the company’s name and not the person’s name.
- Go to the Tax Settings menu and tickmark Vendor eligible for 1099.
- Type in vendor’s tax identification number in Vendor Tax ID section.
- Click on OK once you are done.
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So now you know the procedure of How To Set Up a 1099 Contractor. The process is totally different for Intuit Full Service payroll Intuit online payroll. You need to manually add up all the contractor’s payments to fill out the form. If you still have doubts or is stuck at any point, reach out to an expert at +1(855)-856-0053.
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