The 1099-NEC form is used for reporting non-employee compensation (NEC) payments.
If the following four conditions are met, you must generally report a payment as NEC:
- You made the payment to someone who is not your employee.
- You made the payment for services in the course of your trade or business (including government agencies and nonprofit organizations).
- You made the payment to an individual, partnership, estate, or, in some cases, a corporation.
- You made payments to the payee of at least $600 during the year.
Examples of non-employee compensation that are reported in box 1 of Form 1099-NEC include:
- Professional service fees, such as fees to attorneys (including corporations), accountants, architects, contractors, engineers, etc.
- Payment for services, including payment for parts or materials used to perform the services if supplying the parts or materials was incidental to providing the service.
- Director’s fees and other remuneration.
1. In the Setup menu, click Settings.
2. Click the Objects tab.
3. Select Nonemployee Compensation from the 1099-MISC Amount Code pull-down for applicable Object Elements.
For more information, see Objects.
1. In the Purchasing/Accounts Payable menu, click Print 1099-NEC.
2. The Tax Year defaults to the current fiscal year. If you need to change it, select the correct year from the pull-down.
3. Before printing 1099s from the Print 1099-NEC tab, click the Input Vendor Payments tab for additional vendor payments.
4. Select a Vendor from the pull-down.
5. Enter the Amount, and any Comments pertaining to the payment.
6. Select the 1099-NEC Box in which this information should be displayed once printed, such as 1 - Nonemployee Compensation.
7. Press the Enter key to save the entry.
Inputting vendor payments only applies to district accounts, not internal accounts. Focus internal account purchases will be included automatically.
If two vendor numbers have mistakenly been created for one vendor, you should be sure to flag only one vendor. The payments can then be combined on the Input Vendor Payments screen.
8. Click Import to import vendor payment information stored in an Excel spreadsheet or CSV file.
a. Select the file, and click Open.
b. In the Import CSV pop-up window, ensure the columns match the headers. Use the header pull-downs to ensure the correct column is selected.
c. Click Import CSV.
The imported information displays automatically after being imported.
Click the pull-down or the text fields to edit data.
Click the delete button (red minus sign) to delete the vendor payment.
9. Add as many vendor payments as needed.
Note the Page Total and Grand Total in the last rows.
1. In the Purchasing/Accounts Payable menu, click Print 1099-NEC.
2. The Tax Year defaults to the current fiscal year. If you need to change it, select the correct year from the pull-down.
3. Enter the Tax ID in the provided text box. The Tax ID defaults to data entered via Setup > Settings > Miscellaneous tab.
4. Select a specific vendor from the Vendor(s) pull-down or print 1099-NEC with the default of All Vendors whose payment is greater than or equal to $600.
5. Select whether to Include all vendors marked 1099 or whether to Only show vendors with manual payments using the corresponding check boxes.
Notice that selecting either of these check boxes will cancel out any selected vendors and the Vendor(s) pull-down will no longer display.
6. Select the Correction check box to indicate that the form is a correction.
6. Select a Paper Type from the pull-down.
Select Form 1099-NEC to generate a recipient copy that will include all 1099-NEC data. Select this option if printing on the form purchased directly from the IRS which includes all backgrounds.
Select Letter (Copy B Recipient) to generate a recipient copy that will include all grids and 1099-MISC data. Select this option if printing on plain white paper.
Select Letter (Copy C Payer) to generate a paper copy that will include all grids and 1099-NEC form data.
Select Z-Fold to remove the option to print “Two Per Page” selected from the Special Format pull-down because Z-Fold forms require two 1099-NEC forms for the same vendor on the same sheet.
The printed Z-Fold form contains the following boxes and information:
Box 1 contains the dollar amount of nonemployee compensation.
Box 2 is N/A for school districts.
Box 3 is blank.
Box 4 contains any amount you held back to comply with backup withholding requirements.
Boxes 5-7 are used to report any state withholding.
a. If you select Letter (Copy B Recipient) or Letter (Copy C Payer) from the Paper Type pull-down, you also have the option to select the Print Instructions check box to print the instructions from the IRS directly after the 1099. Printing instructions is required when printing on blank paper.
b. If you select Z-Fold from the Paper Type pull-down, you also have the option to select the Print Form Background check box to print data with background. Note: This options also requires you to purchase blank 1099 NEC Z-Fold forms.
7. Select Two Per Page from the Special Format pull-down to print two copies per page.
8. Select the order in which you want information printed from the Sort Order pull-down, such as Vendor Number, Vendor Name, etc.
When doing any kind of printing, do not scale to page. It is best to use the Chrome print dialog or Adobe Reader.
9. Click Submit.
Clicking Submit generates a pop-up print preview screen. From here you will be able to print your forms.