{"id":4017,"date":"2020-12-08T13:15:21","date_gmt":"2020-12-08T18:15:21","guid":{"rendered":"https:\/\/keysolutions.us\/blog\/?p=4017"},"modified":"2020-12-08T13:15:22","modified_gmt":"2020-12-08T18:15:22","slug":"form-1099-nec-replaces-form-1099-misc","status":"publish","type":"post","link":"https:\/\/keysolutions.us\/blog\/form-1099-nec-replaces-form-1099-misc\/","title":{"rendered":"Form 1099-NEC Replaces Form 1099-MISC"},"content":{"rendered":"\n<p class=\"has-text-align-center has-vivid-green-cyan-background-color has-background\" style=\"font-size:22px\"><strong>New Reporting Rules for Non-Employee Compensation of $600 or More<\/strong><\/p>\n\n\n\n<p class=\"has-text-color has-medium-font-size\" style=\"color:#0667a0\"><strong>There is a new\u00a0<a href=\"https:\/\/www.irs.gov\/forms-pubs\/about-form-1099-nec\" target=\"_blank\" rel=\"noreferrer noopener\">Form 1099-NEC, Nonemployee Compensation<\/a>,\u00a0for business taxpayers who pay or receive nonemployee compensation<\/strong><\/p>\n\n\n\n<p><\/p>\n\n\n\n<p class=\"has-vivid-red-color has-text-color has-medium-font-size\"><strong>The Internal Revenue Service now requires that non-employee compensation paid to non-corporate entities of $600 or more in a year be reported on IRS Form NEC<\/strong><\/p>\n\n\n\n<p><\/p>\n\n\n\n<p class=\"has-vivid-green-cyan-color has-text-color has-large-font-size\"><strong>Background<\/strong><\/p>\n\n\n\n<p class=\"has-medium-font-size\">Starting in tax year 2020, payers must complete Form 1099-NEC to report any payment of $600 or more to a payee.<\/p>\n\n\n\n<p class=\"has-medium-font-size\">Generally, payers must file Form 1099-NEC by January 31. <strong>For 2020 tax returns, the due date is February 1, 2021.<\/strong> <\/p>\n\n\n\n<p class=\"has-medium-font-size\"><strong>There is no automatic 30-day extension to file Form 1099-NEC<\/strong>. However, an extension to file may be available under certain hardship conditions.<\/p>\n\n\n\n<p class=\"has-vivid-green-cyan-color has-text-color has-large-font-size\"><strong>Backup Withholding<\/strong><\/p>\n\n\n\n<p class=\"has-medium-font-size\">Nonemployee compensation may be subject to\u00a0<a href=\"https:\/\/www.irs.gov\/businesses\/small-businesses-self-employed\/backup-withholding\">backup withholding<\/a>\u00a0if a payee has not provided a taxpayer identification number (TIN) to the payer or the IRS notifies the payer that the\u00a0<a href=\"https:\/\/www.irs.gov\/pub\/irs-pdf\/p1281.pdf\">TIN provided was incorrect\u00a0<strong>PDF<\/strong><\/a>.<\/p>\n\n\n\n<p class=\"has-medium-font-size\">A TIN can be one of the following numbers:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Social Security<\/li><li>Employer identification<\/li><li>Individual taxpayer identification<\/li><li>Adoption taxpayer identification<\/li><\/ul>\n\n\n\n<p class=\"has-vivid-green-cyan-color has-text-color has-large-font-size\"><strong>What Is<\/strong> <strong>Backup Withholding<\/strong>?<\/p>\n\n\n\n<p class=\"has-medium-font-size\"><a href=\"https:\/\/www.irs.gov\/businesses\/small-businesses-self-employed\/backup-withholding\">Backup withholding<\/a>\u00a0can apply to most kinds of payments reported on Forms 1099 and W-2G. This means that the person or business paying the taxpayer doesn&#8217;t generally withhold taxes from certain payments. <strong>There are, however, situations when the payer is <span style=\"text-decoration: underline;\">required<\/span> to withhold a certain percentage of tax to make sure the IRS receives the tax due on this income.<\/strong> This is backup withholding.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">More information:<\/h2>\n\n\n\n<ul class=\"wp-block-list\"><li><a href=\"https:\/\/www.irs.gov\/instructions\/i1099msc\">Instructions for Forms 1099-MISC and 1099-NEC<\/a><\/li><li><a href=\"https:\/\/www.irs.gov\/forms-pubs\/about-form-1099\">General Instructions for Certain Information Returns<\/a><\/li><li><a href=\"https:\/\/www.irs.gov\/forms-pubs\/about-publication-15\">Publication 15, (Circular E), Employer&#8217;s Tax Guide<\/a><\/li><\/ul>\n\n\n\n<p class=\"has-vivid-cyan-blue-color has-text-color has-large-font-size\"><strong>Tax Planning Tip #1<\/strong><\/p>\n\n\n\n<p class=\"has-medium-font-size\">If you have not already done so, make sure that you have a complete and accurate <strong><a href=\"https:\/\/www.irs.gov\/forms-pubs\/about-form-w-9\">Form W-9<\/a>, Request for Taxpayer Identification Number and Certification<\/strong> on file, for every non-corporate vendor who provides services to your business. <\/p>\n\n\n\n<p><\/p>\n\n\n\n<p class=\"has-normal-font-size\">If you would like to discuss your business or personal <a href=\"http:\/\/www.keysolutions.us\/svcs_tax.htm\">tax planning<\/a>, <a href=\"http:\/\/www.keysolutions.us\/svcs_tax.htm\">tax preparation<\/a> and other financial concerns with an experienced tax professional, we invite you to call <a href=\"http:\/\/www.keysolutions.us\/\">610-594-2601<\/a> today to make an appointment at our <a href=\"http:\/\/www.keysolutions.us\/index.htm\">Exton PA CPA office<\/a> to discuss your situation. You can also schedule a consultation at <a href=\"http:\/\/keysolutions.us\/consultation.htm\">Click Here<\/a>. <\/p>\n\n\n\n<p class=\"has-vivid-cyan-blue-color has-text-color has-medium-font-size\"><strong>About F. Bryan Haarlander, EA, CTRS:<\/strong><\/p>\n\n\n\n<p class=\"has-normal-font-size\"><strong><a href=\"http:\/\/www.keysolutions.us\/about-our-partners.htm\">Bryan Haarlander<\/a><\/strong>, an Enrolled Agent and a Certified Tax Resolution Specialist, is an affiliate member of the&nbsp;<strong><a href=\"http:\/\/www.suburbanwestrealtors.com\/\">Suburban West Realtors\u00ae Association<\/a><\/strong>,&nbsp;a member of the American Society of Tax Problem Solvers (ASTPS), PA Society of Tax &amp; Accounting Professionals (PSTAP), the National Society of Accountants (NSA) and the National Association of Tax Professionals (NATP). He is the author of&nbsp;<a href=\"https:\/\/www.amazon.com\/Resolve-Your-Debt-Problems-self-representation\/dp\/1540773493\/ref=sr_1_1?keywords=haarlander&amp;qid=1554815433&amp;s=gateway&amp;sr=8-1\"><strong>\u201cHow to Resolve Your IRS Tax Debt Problems\u201d<\/strong><\/a>&nbsp;as well as a book&nbsp;<strong>on&nbsp;<\/strong><a href=\"https:\/\/www.amazon.com\/EMPOWER-Your-Business-Reach-Potential\/dp\/1507525117\/ref=sr_1_2?keywords=haarlander&amp;qid=1554815521&amp;s=gateway&amp;sr=8-2\"><strong>how to start your own business<\/strong><\/a>. He has been practicing in Exton for 19 years. His firm serves clients in the western suburbs of Philadelphia, PA, which includes the cities of Chester Springs, Coatesville, Collegeville, Devon, Downingtown, Exton, Frazer, King of Prussia, Paoli, Philadelphia, Phoenixville, Pottstown, Radnor, Reading, Wayne, West Chester in Berks, Chester,&nbsp; Delaware, Montgomery and Philadelphia Counties, as well as clients in Delaware, New Jersey, New York and throughout the continental USA.<\/p>\n\n\n\n<p class=\"has-normal-font-size\">If not a subscriber to his blogs, <a href=\"http:\/\/www.taxexpertblog.com\/\"><strong>http:\/\/www.taxexpertblog.com<\/strong><\/a>&nbsp;and&nbsp;<strong><a href=\"http:\/\/www.stopmytaxproblems.com\/\">http:\/\/www.stopmytaxproblems.com<\/a><\/strong>you may wish to do so as he discusses various pertinent tax and business issues.<\/p>\n\n\n\n<p class=\"has-normal-font-size\">For individual tax payers, real estate professionals, contractors and other self-employed individuals with&nbsp;<a href=\"https:\/\/www.stopmytaxproblems.com\/\"><strong>IRS tax debt issues&nbsp;<\/strong><\/a><strong>or&nbsp;<\/strong><a href=\"https:\/\/www.keysolutions.us\/\"><strong>tax planning issues<\/strong><\/a>, feel free to&nbsp;<a href=\"https:\/\/www.keysolutions.us\/contact.htm\"><strong>contact me<\/strong><\/a>&nbsp;at (610) 594-2601 or by email at&nbsp;<a href=\"mailto:info@keysolutions.us\"><strong>info@keysolutions.us<\/strong><\/a>.<\/p>\n\n\n\n<p class=\"has-normal-font-size\"><a href=\"https:\/\/www.keysolutions.us\/\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>Keystone Financial Solutions, Inc.<\/strong><\/a>&nbsp;specializes in providing innovative tax planning, tax preparation, and&nbsp;<a href=\"https:\/\/www.stopmytaxproblems.com\/\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>solving IRS tax debt problems<\/strong><\/a>. The company\u2019s web site is&nbsp;<a href=\"https:\/\/www.keysolutions.us\/\"><strong>https:\/\/www.keysolutions.us<\/strong><\/a>&nbsp;and its telephone number is (610) 594-2601.<\/p>\n\n\n\n<p class=\"has-normal-font-size\">By visiting our&nbsp;<a href=\"https:\/\/www.stopmytaxproblems.com\/\"><strong>website<\/strong><\/a>&nbsp;you can learn about the&nbsp;<a href=\"https:\/\/www.stopmytaxproblems.com\/index.htm\"><strong>5 Secrets the IRS Doesn\u2019t Share<\/strong><\/a>&nbsp;and order a&nbsp;<a href=\"https:\/\/www.stopmytaxproblems.com\/free_reports.htm\"><strong>FREE SPECIAL REPORT: Should You Represent Yourself or Hire a Tax Professional.<\/strong><\/a><\/p>\n\n\n\n<p class=\"has-small-font-size\"><strong> BE SURE TO READ THE DISCLAIMER PAGE: Tax laws, IRS rules and regulations change frequently<\/strong>. <strong>Although we hope you&#8217;ll find this information helpful, this blog is for educational purposes only and should not be considered as the rendering of tax, legal or investment advice. The publisher shall not assume liability for any losses, injuries, or damages from the display or use of this information.<\/strong> Should you wish to engage our firm to represent you and your individual situation, please call us at (610) 594-2601.<\/p>\n\n\n\n<p class=\"has-small-font-size\"><strong>Copyright \u00a9 2020 Keystone Financial Solutions, Inc.&nbsp; All rights reserved.&nbsp;<\/strong><\/p>\n\n\n\n<p><\/p>\n\n\n\n<figure class=\"wp-block-image\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"768\" src=\"https:\/\/keysolutions.us\/blog\/wp-content\/uploads\/2019\/02\/KEYSTONE-Logo-in-paint-resized-1024x768.jpg\" alt=\"\" class=\"wp-image-2958\" srcset=\"https:\/\/keysolutions.us\/blog\/wp-content\/uploads\/2019\/02\/KEYSTONE-Logo-in-paint-resized-1024x768.jpg 1024w, https:\/\/keysolutions.us\/blog\/wp-content\/uploads\/2019\/02\/KEYSTONE-Logo-in-paint-resized-300x225.jpg 300w, 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