On Demand Webinar

New Form 1099-NEC

Please see below for additional instructions and information regarding this program.

Webinar Details$219

This webcast provides accounts payable with plain English explanations breaking down the toughest 1099 due diligence situations for 2020 - featuring a comprehensive box-by-box review of both the new 2020 Form 1099-MISC and 1099-NEC:

Agenda:

• Get tips for addressing how the new IRS Forms 1099-NEC and 1099-MISC impact your in-year due diligence for 2020

• Break down the new Form 1099-MISC and NEC trickiest compliance situations: rent, leases, prizes and awards, hotel payments, freight payments, attorney and settlement payments between the two forms, backup withholding, where medical service provider payments are now going, discover when the reporting does not follow the payment, where to report non-qualified deferred compensation, determine when payments are 1099-S, 1099-INT, and W-2 reportable instead of on the 1099-MISC or 1099-NEC, and more...

• Learn how to reshape your vendor validation tasks for 2020

• Discover how to differentiate between payments that are now 1099-NEC reportable versus those that are 1099-MISC reportable

• Identify key elements of the IRS due diligence and reasonable cause rules related to these new forms and recognize how to identify the reportable payee when you pay sole proprietors, LLCs, payee's merged or bought by another, S-Corps, agents, liens/garnishments, and other middlemen.

• Live question and answer with our tax expert!

Learning Objectives:

• Learn to break down the new Form 1099-MISC and NEC trickiest compliance situations

• Learn how to reshape your vendor validation tasks for 2020

• Learn how to differentiate between payments that are now 1099-NEC reportable versus those that are 1099-MISC reportable

  1. Introduction
  2. What’s New  - 00:01:14
  3. What’s New - 2020 Form 1099 NEC - 00:05:35
  4. What’s New - The 2020 Form 1099-NEC - Reportable Payments 00:07:13
  5. What’s New - The 2020 Form 1099-NEC - Reportable Payments and Box 1 00:09:51
  6. What’s New - The 2020 Form 1099-NEC - Non-Reportable Payments 00:13:16
  7. What’s New - The 2020 Form 1099-NEC - Other Implications 00:17:40
  8. What’s New - The 2020 Form 1099-MISC - 00:26:32
  9. What’s New - The 2020 Form 1099-MISC - Boxes 1,2,3, and 6 00:31:46
  10. What’s New - The 2020 Form 1099-MISC - Non-Reportable Payments 00:44:47
  11. What’s New - The 2020 Form 1099-MISC - Related Implications 00:47:20
  12. What’s New - The 2020 Form 1099-MISC - Related Implications (cont’d) 00:51:40
  13. What’s New - The 2020 Form 1099-NEC and 1099-MISC - Your Action Steps 00:55:56
  14. 1099 Due Diligence Starts with the W-9 00:59:37
  15. Watch Those TIN’s! 01:02:55
  16. Payee Refuses to Provide TIN: What Do You Do? 01:04:44
  17. You Must Perform Your Form W-9 Solicitations 01:06:34
  18. Problem Payees and 1099 Due Diligence - 01:09:00
  19. Problem Payees and 1099 Due Diligence - The LLC  01:09:27
  20. Problem Payees and 1099 Due Diligence -The LLC as the Disregarded Entity 01:11:57
  21. Problem Payees: The Exempt Organization and Due Diligence 01:14:18
  22. TIN Matching and 1099 Filing 01:15:25
  23. Backup Withholding Policies and 1099 Filing 01:16:50
  24. Another Year-End Task: B-Notice Response Best Practices 01:17:59
  25. Protect Yourself - 01:21:31
  26. Question and Answer - 01:22:36
  27. Presentation Closing 01:42:28
Backup Withholding 00:04:01, 00:47:30, 
B-Notice 00:02:58, 01:18:04
CP-2100 00:03:27, 01:18:25
CP-2100-A 00:03:29, 01:18:25
DBA -Doing Business As 01:00:10
Disregarded Entity 01:00:34, 
EIN 01:03:10
Form 1099-B 01:15:25
Form 1099-DIV 01:15:25
Form 1099-INT 01:15:25
Form 1099-K 01:15:25
Form 1099-MISC 00:02:25, 00:04:16, 00:13:51, 00:44:51
Form 1099-NEC 00:02:16, 00:04:16, 00:08:18, 00:17:26
Form 1099-OID 01:15:25
Form 1099-PATR 01:15:25
Form 8809 00:20:02
Form 8832 01:09:51
Form 945 01:17:40
Form 990 01:14:52
Form W-9 00:59:40, 01:08:03
IRC Section 3406(a) 00:03:54
IRC Section 6041(a) 00:03:53
IRC Section 6109(a)(2) 00:03:53
Limited liability company (LLC) 00:09:02, 01:00:22, 01:09:31
Sole Proprietor 00:09:13, 01:00:20, 01:10:29
Tax Cuts and Jobs Act 00:14:21
Tax Exempt Organization Search Tool 01:14:43
Tax Gap 00:01:24
TIN 00:06:59, 00:17:14, 00:49:05
TIN Match Program 01:15:29
Vendor 00:17:09

Backup Withholding: Backup withholding is the tax that is levied on investment income, at an established tax rate, as the investor withdraws it. Backup withholding helps to ensure that government tax-collecting agencies (such as the IRS or Canada Revenue Agency) will be able to receive income taxes owed to them from investors' earnings. (www.investopedia.com)

B-Notice: A notice from the IRS stating that one or more tax ID numbers were missing from a 1099 or do not match the IRS records.

CP-2100: It is a notice that tells a payer that he or she may be responsible for backup withholding. It is accompanied by a listing of missing, incorrect, and/or not currently issued payee TINs. Large volume filers will receive a CD or DVD data file CP2100, mid-size filers receive a paper CP2100, and small filers receive a paper CP2100A.

CP2100-A: It is a notice that tells a payer that he or she may be responsible for backup withholding. It is accompanied by a listing of missing, incorrect, and/or not currently issued payee TINs. Large volume filers will receive a CD or DVD data file CP2100, mid-size filers receive a paper CP2100, and small filers receive a paper CP2100A.

DBA -Doing Business As: Sometimes it makes sense for a company to do business under a different name. To do this, the company has to file what's known as a DBA, meaning "doing business as." A DBA is also known as a "fictitious business name," "trade name," or "assumed name."

Disregarded Entity: A disregarded entity refers to a business entity with one owner that is not recognized for tax purposes as an entity separate from its owner. A single-member LLC ( “SMLLC”), for example, is considered to be a disregarded entity. (www.pntax.com)

EIN: The Employer Identification Number, also known as the Federal Employer Identification Number or the Federal Tax Identification Number, is a unique nine-digit number assigned by the Internal Revenue Service to business entities operating in the United States for the purposes of identification.

Form 1099-B: Proceeds From Broker and Barter Exchange Transactions is an Internal Revenue Service (IRS) tax form that is issued by brokers or barter exchanges. The form lists the gains or losses of all broker or barter exchange transactions.

Form 1099-DIV : Form 1099-DIV: Dividends and Distributions is an Internal Revenue Service (IRS) form sent to investors who receive distributions from any type of investment during a calendar year. Investors can receive multiple 1099-DIVs. Each Form 1099-DIV should be reported on an investor's tax filing.

Form 1099-INT: Form 1099-INT is the IRS tax form used to report interest income. The form is issued by all payers of interest income to investors at year end and includes a breakdown of all types of interest income and related expenses. Payers must issue Form 1099-INTs for any party to whom they paid at least $10 of interest during the year.

Form 1099-K: A payment settlement entity (PSE) must file Form 1099-K for payments made in settlement of reportable payment transactions for each calendar year. A PSE makes a payment in settlement of a reportable payment transaction, that is, any payment card or third party network transaction, if the PSE submits the instruction to transfer funds to the account of the participating payee to settle the reportable payment transaction.

Form 1099 MISC: The Form 1099-MISC is an Internal Revenue Service (IRS) tax return document used to report miscellaneous payment​s made to nonemployee individuals, such as independent contractors, during the calendar year. (www.shrm.org)

Form 1099-NEC: In the context of 1099 tax filing, NEC stands for “Nonemployee Compensation” (the first letters of the three words None, Employee and Compensation). Most tax payers recognize NEC as box 7 on Form 1099-MISC. NEC is used to report income paid to independent-contractors / the-self-employed (referred to as 1099 employees for simplification purposes). So, while employers report income that gets paid to employees on Box 1 (Wages, tips, other compensation) of the W2 form, payers report income that gets paid to none-employees on Box 7 (NEC) of the 1099-MISC form. As an individual, if you received form 1099-MISC instead of Form W-2 then the payer did not consider you an employee and did not withhold income tax or social security and Medicare tax.

Form 1099-OID: Form 1099-OID is a tax form intended to be submitted to the Internal Revenue Service by the holder of debt instruments which were discounted at purchase to report the taxable difference between the instruments' actual value and the discounted purchase price.

Form 1099-PATR: File Form 1099-PATR, Taxable Distributions Received From Cooperatives, for each person to whom the cooperative has paid at least $10 in patronage dividends and other distributions described in section 6044(b), or from whom you withheld any federal income tax under the backup withholding rules regardless of the amount of the payment.

Form 8809: Use Form 8809 to request an initial or additional extension of time to file only the forms shown on line 6 for the current tax year.

Form 8832: Form 8832 is the Entity Classification Election form from the IRS. It is filed to elect a tax status other than the default status for your entity. For example, an LLC can elect to be taxed as a C Corporation.

Form 945: IRS Form 945 is titled Annual Return of Withheld Federal Income Tax. Form 945 is used to report withheld federal income tax from nonpayroll payments, including distributions from qualified retirement plans.

Form 990 : Form 990 (officially, the "Return of Organization Exempt From Income Tax") is a United States Internal Revenue Service form that provides the public with financial information about a nonprofit organization. It is often the only source of such information.

Form W-9: Form W-9 (officially, the "Request for Taxpayer Identification Number and Certification") is used in the United States income tax system by a third party who must file an information return with the Internal Revenue Service (IRS). It requests the name, address, and taxpayer identification information of a taxpayer (in the form of a Social Security Number or Employer Identification Number). - Wikipedia (https://en.m.wikipedia.org/)

IRC Section 3406(a): Requires that, under certain circumstances, including the payee's failure to provide a TIN, the payer must perform backup withholding.

IRC Section 6041(a): Provides that persons engaged in trade or business must report certain payments on an information return.

IRC Section 6109(a)(2): Requires that a payee provide a TIN to the payer when the payment will be reportable on an information return.

Limited liability company (LLC): An LLC is a corporate structure where members cannot be held accountable for the company’s debts or liabilities. This can shield business owners from losing their entire life savings if, for example, someone were to sue the company. Can be a single member (much like a sole proprietor) or a multi-member. It shares certain traits of both corporations as well as partnerships or sole proprietorships. It is not a corporation.

Sole Proprietor: A business that legally has no separate existence from its owner. The sole proprietorship is the simplest business form under which one can operate a business. The sole proprietorship is not a legal entity. It simply refers to a person who owns the business and is personally responsible for its debts.

Tax Cuts and Jobs Act: The Act to provide for reconciliation pursuant to titles II and V of the concurrent resolution on the budget for fiscal year 2018, Pub.L. 115–97, is a congressional revenue act of the United States originally introduced in Congress as the Tax Cuts and Jobs Act, that amended the Internal Revenue Code of 1986.

Tax Exempt Organization Search Tool: Tax Exempt Organization Search helps users find information about a tax-exempt organization’s federal tax status and filings.

Tax Gap: The gross tax gap is the difference between true tax liability for a given tax year and the amount that is paid on time. It is comprised of the nonfiling gap, the underreporting gap, and the underpayment (or remittance) gap.

TIN: A Taxpayer Identification Number is an identifying number used for tax purposes in the United States and in other countries under the Common Reporting Standard. In the United States, it is also known as a Tax Identification Number or Federal Taxpayer Identification Number.

TIN Match Program: TIN Matching is part of a suite of Internet-based pre-filing e-services that allows “authorized payers” the opportunity to match 1099 payee information against IRS records prior to filing information returns.

Vendor: A vendor is a person or business that supplies goods or services to a company. Another term for the vendor is the supplier. In many situations, a company presents the vendor with a purchase order stating the goods or services needed, the price, delivery date, and other terms.


Guest Speaker

Steven Mercatante

Steven Mercatante

Steven Mercatante is the principal and founder of TIR Consulting, LLC. He is a nationally recognized leader in tax reporting education and consulting on specialized compliance issues. He has conducted on-site consultation for corporate clients from across the world and led countless seminars and webinars for Convey Compliance Systems, IAPP, Balance Consulting, The Accounts Payable Network, Accounts Payable Now and Tomorrow, Progressive Business Conferences, The Center For Competitive Management,... View Full Profile


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