How to File IRS 1099-MISC forms with QuickBooks without EIN numbers

Tax Tip for QuickBooks Users

A business is required to issue a 1099-MISC form to an individuals and businesses that earn more than $600 for goods and services according to current rules under Code Sec. 6721(a), (b); Reg. §301.6721-1(a)(1). You can learn more about the filing requirements for the 1099-MISC form in the articles “Everything You Wanted to Know About the 1099-MISC Form”. You will need to gather certain information about the individuals and business that contract with you to prepare the 1099-MISC form properly.

Among this information, you will need to get a businesses’ Employer Identification Number (EIN).

Practical Advice: You should check the 1099-MISC filing requirements at www.irs.gov or with your tax professional prior to filing. The filing threshold is subject to change so be sure you know what it is at the time that you are filing the 1099-MISC forms so you ensure you are in compliance with this tax reporting requirement.

What is an EIN?

The IRS defines an EIN as a “Federal Tax Identification Number, [that] is used to identify a business entity. Generally, businesses need an EIN.” You can learn more about what the IRS has to say about EINs here. To rephrase the technical definition above, an EIN is a substitute for a contractor’s or business’ social security number – it is a unique number assigned to these individuals and business for identification purposes.

How do you obtain a contractor’s EIN?

You obtain a contractor’s EIN by having your contractors complete a W-9, which is a form titled “Request for Taxpayer Identification Number and Certification”. It is good business practice to have all new contractors and businesses complete a new vendor packet, which would include items such as a personal/business information sheet, contract, and the W-9.

This is considered a good business practice because it ensures that you have all the information that you need to prepare your 1099-MISC forms annually prior to conducting business with your vendors and contractors. It is always much easier to get this in advance rather than after you have already started working with them.

Do I have to prepare a 1099-MISC Form without an EIN?

Yes, you are required to complete the 1099-MISC form if you meet the filing threshold of paying $600 or more for an individual or business within a year even if you do not have an EIN or Social Security Number to put on the form.

How do I file a 1099-MISC with QuickBooks without an EIN?

You can file a 1099-MISC form for any contractor or business without an EIN by using the QuickBook’s 1099 Wizard.  You can find step-by-step instructions for how to use the 1099 Wizard here. However, you will not be able to e-file the 1099s at this time. You will need to file paper copies of your IRS Form 1099s if you are missing any information on the form. Again, you must still file the form with the IRS even if it is incomplete.

Practical Advice: You do not have to file a 1096 transmittal form, which is a summary of the information you filed on each of the individual 1099s, if you e-file your 1099s.

However, you are required to file the 1096 when you file your 1099-MISC forms by paper so be sure to print and send this form in if you have to file your 1099s in paper form with the IRS.

Conclusion

You must file 1099-MISC forms for individuals and business if they are paid at least $600 or more in a tax year. While you may not have all the information to prepare the form, you still should file the form -- you will want to put policies and procedures in place to ensure that you get this information, such as having them complete W-9s prior to doing business with them. You can then sure you have all the information to fulfill your tax reporting obligations regarding the 1099-MISC forms.