Software That Will Complete and File 1099-MISC Forms for You
If you're a business owner, you're required to file 1099-MISC forms with the IRS to report any payments you made to vendors for goods or to contractors for services. The form also reports prize money paid out and just about any other compensation made to anyone who is not your employee. You're required to do this because these individuals (or companies) must pay taxes on this income, and you haven't withheld any taxes from the payments because they're not your employees. You should provide the vendor or contractor with a copy of the form as well.
As of 2018, you must file a 1099-MISC form whenever you pay any non-employee $600 or more during the calendar year, although there are some exceptions to this rule. This means $600 in total, not per individual payment. If you make three payments of $200 each, you would have to report all three payments on Form 1099-MISC.
The filing threshold is subject to change and can increase or decrease at any time so it's advisable to periodically visit the IRS website to ensure that you know the current amount and keep abreast of other requirements.
Most accounting software programs can help you prepare 1099s. These are six of the most helpful.
Real Business Solutions develops accounting and tax software for small business owners, including 1099 preparation software. The software is compatible with a number of different programs including QuickBooks.
You can create, file and print 1099-MISC forms using this software. The website includes a demo, pricing and other pertinent information. First-time users can also download a free trial.
According to multiple reviews, the software is easy to navigate and provides icons with access to various system functions. There are also shortcuts available for anyone who needs to import or export data from other programs or applications. Using this software allows the user to send the 1099-MISC to recipients electronically.
Zoho Books is a cloud-based accounting software program for small businesses. The software allows users to create multiple reports and forms including invoicing, banking, inventory, expenses, bills, and taxes.
Pricing is separated into three tiers: Basic at $9 per month, Standard (the most popular) at $19 a month and the Professional package for $29 per month.
One of the best features of Zoho Books is a detailed tutorial on how to prepare 1099s using its software. This tutorial comes with screenshots so the user can easily reference what they're doing with the instructions.
Yearli.greatland.com lets you enter your 1099-MISC information online, after which you can file the forms electronically with the IRS and transmit them to your vendors and contractors. You also can import the 1099 data from your accounting software if it is compatible with FileTaxes.com's system.
There are three separate subscriptions each with a different price point and features. The Core package is free and allows the user to fill out 1099-MISC forms. The Performance package costs $99 each year and gives the user additional forms to file. The third package, the Desktop, costs users $439 each year with the most features. None of the packages include filing fees.
This is another helpful product offered by Greatland. The company specializes in W-2 and 1099 reporting for small- to mid-sized businesses.
You can import your accounting software data into Greatland's website and then e-file your 1099-MISC forms with the IRS and have the forms mailed directly to your vendors and contractors.
The cost depends on the type of form and how many are ordered.
If you want to be able to file your 1099 forms electronically, efile1099NOW is a good option. All data can be entered manually online, or it can be imported from Microsoft Excel or QuickBooks. You also have the option of both e-filing and sending copies to vendors or contractors.
Users must create a free account in order to use the service. The cost depends on how many forms you file and how they are distributed — through e-file, print and/or mail.
Advanced Micro Solutions is a complete payroll processing provider, but it also can be used for individual tasks such as filing 1099s. The software for filing 1099s is its base product and necessary for using any of its other services.
But if filing 1099s is all you want to do, that's the only software you'll need to purchase. You can order the 1099 software for $79. The service will file all forms directly with the IRS and SSA electronically. The forms can also be printed out or exported.
Be Sure to File Your 1099-MISC Forms
You'll want to make sure that you understand the filing requirements for 1099-MISC forms before you dive in to prepare them, even with the guidance of software. It's critical that you file your forms with the IRS on time and provide them to contractors and vendors before the yearly deadline. The penalties for noncompliance, especially failing to file or filing late, can be rather substantial. And, the penalties far outweigh the short amount of time it takes to prepare this information.
Consider contacting a qualified tax professional if you have any questions about your responsibility for filing this form or any other tax form. Most accounting software programs such as QuickBooks also can be set up to easily file these 1099 forms. This option might be suitable if your business or enterprise is not large or complex, such as if you're a sole proprietor.