1099 and workers QBO

Hi there, Linda Ardissani, Ardissani Bookkeeping. I want to talk a little bit about 1099s, and I don't know if you were aware of the information that's right in the program for you regarding this. It tends to be a confusing point. I know a lot of people aren't sure if they're supposed to send their subcontractor a 1099 or not. Or a lot of people get confused and call their subcontractors employees, which can open up a whole other can of worms. So I'm just going to come into my file and just show you where this information is. So Party Like It's 1099, really cute. Click on here, and this is where a lot of the information is hidden in QuickBooks, so you can just kind of learn about the law and learn about what's there. So you can prepare your 1099s in QuickBooks. Had a wonderful video. I was going to do a video on how to produce these, but she just put together such a great video. I shared it on my Facebook page. So if you're not on there, if you want to just put a like and then you'll get updates. You can e-file them with QuickBooks. This is what I just do with— my daughter works for me. She's a subcontractor. She doesn't work in where I work. She doesn't come to the office. She works on her own schedule, her own time. I don't tell her what to do other than I Have a few clients that she works on, and she works on them on her own. So she fits into the 1099 category, and they deliver them online, and they also mail them out. So I sent it to her via my ShareFile. You don't want to send these in an email unless you have a product like ShareFile where you can send it confidentially, because there's Social Security numbers on it. So you don't want to be just emailing them. So what are the deadlines? So here's it right here, frequently asked questions. What are the deadlines? So the deadline is January 31st. You need to get these 1099s out. You can pick up a kit and print them out. I've seen a lot of people on the forum that are having trouble with the kit and the lining up of the product. I'd just rather do it online. I mean, you're on QuickBooks Online, you might as well do everything online. There's a fee. You don't want to miss the deadline. So January 31st is the deadline to mail, so you need to have that postmarked there. It's mostly for the 1099 people that are in box 7, so your subcontractors, those people that you need to Send them out for them. If you miss the deadline, you can ask for an extension, and they even provided you with a link in here that you can fill that out. You can continue to— after 5 PM on January 27th, they're going to continue to mail them out and print them out. But that's the only date you have to get them in for with QuickBooks to get them guaranteed for the 31st. So you don't want to wait until the 28th for the online because you want to make sure that you get them in on the deadline. You just don't want to wait till the last minute on anything like that. So the cost, if you want to do it with their e-file system, it's $12.99 for the first 3 forms and $2.99 for each one, and then forms beyond the 20 is free. So pretty reasonably priced, in my opinion, for producing them. As of January 17th, the price goes up to $14.99 and $3.99. So if you can get it done in the next few days, it's worth your, your bother. You'll get a little bit of a discount there. And then if you want to print and mail them, you'll need the special form. So you can print out— it's the 1096, the form that just tells the government how much you're going to be paying overall. It's a special red form and it's special paper, so you need to have that. And of course you're going to pay for postage and you've got to bother with making them line up. Here's a list of the states you can check with to see if you need to have them filed with the state. So you want to make sure that they're filed with the state if your state's listed in this list. I— oh, that's nice. This is what I love about QuickBooks. They provided you with a link and it doesn't work. So I'm wondering if the link up here works. But you can Google it, look for the states that require 1099s, and I'm sure that they'll give you that. How do the contractors get the copies? If you invite them through QuickBooks, and that's a new feature that's going to be coming up very shortly, where they'll start to put their own information in, and then once it's in, you'll be able to draw it. If he's already had a relationship with QuickBooks and put their Social Security number in under their company file, you'll be able to pull that off the contractor list through an online portal. So you can do that. To me, it's just easier just to do it electronically. You don't have to worry about that. They'll send it out for the states. I love this one. What's a 1099? So it's for a self-employed person that works for your business that makes over $600, and it could be a subcontractor like my daughter. She works on her own and, and she's got her own little thing as a sole proprietor. It could be a contractor. There's also— you might have to give them to your attorney or your accountant. You just need to know if they're incorporated and if they they're someone you should be paying for. W-9 is what you're going to ask them for before you pay them. That's the key. So if you're going to pay a subcontractor, you want to have that W-9 so you can get their Social Security number or their business number. And you can invite them in under the Workers tab, and I'll show you that in a moment. And that way you've got that information right in your file. And you need that along with their address, the correct mailing address. Can you print them? Yes, you can print them with that kit. Last day to file, April 30th. And if you need help, you could ask for help with the chat. So let's go back to workers. So here's the worker tab, and you can see there's a section for employees and a section for contractors. So contractors or subcontractors, and I've got my daughter in here and Obviously, I won't open this up because that will expose her details, but this is who I would— I can pay her from here and I can prepare the 1099 from here. And then if you go to that other video that's on my Facebook page, it's going to take you through all the steps that are required to get this done. You have to set up your 1099 account. So because she's my subcontractor, box 7 for me is just subcontractor, and that's what I apply it to when I pay her. So that's how QuickBooks sees it. So you also have to edit your vendor. So let's go to the sample company file here so I can show you how you would edit a vendor to add that to that particular category. So let's go in here, Workers, Contractors. I'm going to add my first contractor, so I'll just do Joe Bananas. Not Bananas, Bananas. Okay, so Joe Bananas, and I'm going to put in Joe Bananas— probably is a person— @gmail.com. And so you can invite them to fill out the rest of the information here. If you have that information, just uncheck the box. I'm not going to do that in case there is really a Joe Bananas out there. Near the end of the day, so I guess I'm a little silly. So personal details, I can start right here. This is new. So he's an individual, he's not a business, and he files under a Social Security number. So you put all this information in. It's going to need their social. So this is about as far as I'm going to get on here. So you're going to need his information of his address. It's required. You have to put in their social. And that way it's attached to him. So that's why this new feature of inviting him in, he can actually put that in, those details in, and that it's attached to that. So when you start to do your 1099s, you have to map the account. So I'm going to click Let's Get Started. I don't have a tax ID. I don't know if it will take. I think you need 9. Oh, it took it. Okay, let's go next. So here's the box. So box 7, non-employee compensation, and then I'm going to put subcontractor here. I don't even know if I have that in here. Subcontractor expense. So I'm going to add that. I don't think I have that account. So I don't have that account in here. I don't think I can add it from here. So I would have to add it in my chart of accounts before I tried to put that in here. So for now, let's just say he does computer and internet work for me. I'll hit Next. And then, as you can see, my Joe Bananas doesn't have this information, so I can't produce this. 1099 without the information, so I need that. So I'm just gonna hit save and finish later, but it's very easy and you can just follow, follow the steps basically, and then you can process it. You put your credit card in, you'll get the confirmation that says it's been processed, and then you'll get a PDF of what's been processed. If you forget to get that out of there, I like to save that. Like I said, I use ShareFile, so I save all my, my pertinent paperwork in ShareFile as a backup. So if you have a file on your computer, it's a good place to save some of those things that are In your file, like your tax returns and things that you have for your company. You want to save those things outside of QuickBooks as well as inside the program. So I hope that's helpful for you. I know that's a lot of kind of an overview. It's not as detailed as what Mariette did, but I want you to understand what's involved. I know there's a lot of confusion about who's a subcontractor, who's a company, you know, When in doubt, get the W-9 filled out, but you don't have to send a 1099 to someone like me who's got a corporation and I take care of all my own taxes. So it's more for that subcontractor that maybe you're a home remodeler and you have a painter that you use, but he's a sole proprietor. He doesn't have a corporation. He's just a single guy using his Social Security number and you pay him to do a job that's $4,000 and you need to— Send him a 1099. It's just a backup of what income he's received, and then obviously he can report that on his tax return when he does his personal return. I hope that's helpful. It's kind of a short video, but hopefully that'll explain a little bit of how to work in the 1099 system. Get it done now so you can get that discounted price. And if you have any questions or would like a blog post on a future topic, please reach out to me on Facebook. Thank you so much for watching. Bye now.