The 1099 contractor form 2019 is shifting. The American tax code changes frequently, but it doesn’t often affect the two major wage forms: the 1099 and W-2. But this year, 2020, has brought some major changes to life in the United States, and the way we do taxes is no exception. Starting in the 2020 tax year, employers and businesses will distribute 1099-NEC forms rather than 1099-MISC forms for those receiving non-employment compensation. Folks who still need to report rents, prizes and awards, medical and health care payments, and some other types of payments will still need to use the 1099-MISC. But most independent contractors will receive the 1099-NEC going forward.
This is different from the 1099 contractor form 2019. While most businesses will simply need to complete a new form, others who may be late on filing may experience some confusion. If you’re in this situation, know that you’re not alone. Additionally, there are software tools that can help mitigate any confusion and prevent late filings from happening down the road.
Advanced Micro Solutions provide some of those tools. From our W2 and 1099 Forms Filer to AMS Payroll, we have the semi-automated accounting software to prevent missed filings and clear up any confusion caused by the 2020 1099 shift.
Everything to Know About the 1099-NEC
Before attempting to rectify a 1099 contractor form 2019 filing, you’ll need to understand what, specifically, has changed in 2020. The 1099-NEC is now used to report independent contractor income. Previously, this was reported in Box 7 of the 1099-MISC. Whether you have a contracted writer on your content team or hired somebody to install installation in your building, they’ll now receive a 1099-NEC instead of a 1099-MISC.
Here’s where the confusion starts: If you’ve still not filed a 1099 for the 2019 tax year, you’ll need to revert back to the previous protocol – using a 1099-MISC. That said, we recommend doing this as soon as possible. There is typically a three-year statute of limitations on 1099 forms. If you haven’t received a fine or complaint from the IRS for 2019 taxes yet, you might sometime in the next couple of years.
Software Solutions to Keep Up with a Changing Tax Code
As we’ve said above, the American tax code changes all the time. The 1099-MISC and 1099-NEC shift will impact more folks than usual. If you’re struggling to keep up with a changing tax method, or if you’re struggling to file your typical 1099 forms, we have a solution. The W2 and 1099 Forms Filer from AMS is an all-in-one software solution that can help organize and expedite filing. Enter data directly onto a digital facsimile of the form, which is always updated, then have the option to file directly from the software.
Plus, when combined with AMS Payroll, our semi-automated payroll software, users can keep all employee and contractor information in one software. AMS Payroll can calculate and store wages and contractor payments, which are then accessible for end-of-year filing. Don’t risk another late or lapsed filing, like a 1099 contractor form 2019. Get started with AMS today.