tl;dr version: There’s a new 1099 form that you need to use for non-employee compensation (1099-NEC). If Common Cents Bookkeeping sends out your 1099s for you, then you don’t need to do or know anything else right now. We will be in touch regarding relevant deadlines.

The long version…. So, what is this about a new 1099 form the IRS came up with??

You may know that IRS form 1099-MISC is where you record a number of different types of payments made to vendors: rent, royalties, and non-employee compensation to name a few.

If you as an employer need to issue a 1099-MISC for non-employee compensation, it used to be that the deadline to get copies to recipients was January 31, and then the filing deadline with the IRS was 2/28 for paper filing and 3/31 for electronic filing.

But then congress, in its infinite wisdom, passed a law requiring that 1099-MISC forms with the NEC Box filled out needed to be FILED by 1/31, but 1099-MISC forms with other boxes filled out (e.g., rent, royalties) didn’t need to be filed until later. So essentially, one form had two different filing deadlines – HORRORS! (actually, yeah, that’s bad and confusing).

So beginning tax year 2020, there will still be a 1099-MISC for payments like rent and royalties. It will have a filing deadline of 2/28 if filing by paper and 3/31 if filing electronically.

And there is the brand new 1099-NEC, with a 1/31 deadline for both recipients and filing with the IRS (and it’s actually 2/1 in 2021 because 1/31 is a Sunday).

If Common Cents Bookkeeping mails and files your 1099s, we will be in touch with you if we need any additional information from your vendors.