This Form 1099-NEC is used to report non-employee compensation; it is a new form as of the tax year 2020. This replaces form 1099-MISC Box 7 for reporting non-employee compensation.
When You Need to File Form 1099-NEC?
- If you’ve made payments of $600 or more to an individual who is not your employee (personal payments are not reportable)
- If the following four conditions are met, you must file an 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
- You made the payment to an individual, a partnership, an estate, or, in some cases, a corporation
- You made payments to the payee of at least $600 during the year
Who Must File 1099-NEC?
Any business that meets the above conditions and is operating for profit or gain must file. Non-profit businesses and government agencies are considered to be in a trade or business and are required to file 1099-NEC as well.
Other organizations subject to these reporting requirements include:
- Trusts of a qualified pension or profit-sharing plans of employers
- Certain organizations exempt from tax under section 501(c) or 501(d)
- Farmers’ cooperatives that are exempt from tax under section 521
- Widely held fixed investment trusts
Form 1099-NEC Deadlines 2020
Forms must be transmitted to the IRS before the deadline. The due date for eFiling for Form 1099-NEC is February 1. If the due date falls on a weekend or holiday, it will be due the next business day.
How to eFile 1099-NEC for the Year 2020?
Tax1099 is the go-to source for your 1099 filings. You can eFile Form 1099-NEC Online for the year 2020 using Tax1099. Don’t wait for the deadline eFile Now.!