On Demand Webinar

New Form 1099-NEC

Webinar Details $219

  • Rated:
  • Webinar Length: 100 Minutes
  • Guest Speaker:   Steven Mercatante
  • Topic:   Taxation and Accounting
  • Credit:   CPE 2.0, IRS 2.0
All Access Membership

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  - 00:01:20
  3. What’s New - 2020 Form 1099 NEC - 00:05:28
  4. What’s New - The 2020 Form 1099-NEC - Reportable Payments 00:07:52
  5. What’s New - The 2020 Form 1099-NEC - Reportable Payments and Box 1 00:12:01
  6. What’s New - The 2020 Form 1099-NEC - Non-Reportable Payments 00:20:01
  7. What’s New - The 2020 Form 1099-NEC - Other Implications 00:23:29
  8. What’s New - The 2020 Form 1099-MISC - 00:28:42
  9. What’s New - The 2020 Form 1099-MISC - Boxes 1,2,3, and 6 00:34:33
  10. What’s New - The 2020 Form 1099-MISC - Non-Reportable Payments 00:45:29
  11. What’s New - The 2020 Form 1099-MISC - Backup Withholding Implications 00:47:07
  12. What’s New - The 2020 Form 1099-MISC - Related Implications 00:52:48
  13. What’s New - The 2020 Form 1099-NEC and 1099-MISC - Make Sure That You: 00:52:40
  14. 1099 Due Diligence Starts with the W-9 01:07:31
  15. Watch Those TIN’s! 01:10:14
  16. Watch Those TIN’s! (cont’d) 01:10:54
  17. Your Filing Baseline 01:11:48
  18. Validating Data - Identifying Your Payment 01:13:25
  19. Validating Data - Identifying Your Payee 01:13:33
  20. Validating Data - U.S. Persons 01:14:56
  21. Validating Data - W-9 Red Flags 01:15:58
  22. Validating Data -Problem Payees - Quick Review 01:17:56
  23. Validating Data -Problem Payees - The LLC  01:18:53
  24. Validating Data - Problem Payees -The LLC as the Disregarded Entity 01:19:42
  25. Validating Data - The Exempt Organization 01:21:04
  26. Validating Payee Data -TIN Match Program 01:21:53
  27. Reporting - The Basics 01:24:01
  28. Filing Tips - The Middleman 01:25:15
  29. Paper Filing Tips 01:27:23
  30. The “Other 1099’s”: The 1099-K 01:29:04 
  31. The “Other 1099’s”: The 1099-R 01:30:29
  32. The “Other 1099’s”: The 1099-INT, 1099-B, 1099-DIV, 1099-C 01:32:04
  33. Protect Yourself  01:34:20
  34. Question and Answer  01:35:40
  35. Presentation Closing 01:44:59

    • Backup Withholding 00:47:09
    • B-Notice 01:22:36
    • DBA -Doing Business As 01:07:59
    • Disregarded Entity 01:10:33
    • EIN 01:10:57
    • Expense Reimbursement 00:18:41, 00:20:16
    • FATCA 01:09:00
    • Form 1042-S 01:13:14
    • Form 1099-B 01:21:53, 01:32:16
    • Form 1099-DIV 01:21:53, 01:32:16
    • Form 1099-INT 01:21:53, 01:32:07
    • Form 1099-K 01:21:53, 01:29:05
    • Form 1099-MISC 00:06:29, 00:19:42, 00:20:04, 00:28:48
    • Form 1099-NEC 00:03:44, 00:12:22, 00:18:34
    • Form 1099-OID 01:21:53
    • Form 1099-PATR0 1:21:53
    • Form 1099-R 00:21:36, 01:30:29
    • Form 945 01:14:49
    • Form 990 01:21:48
    • Form W-2 00:18:09
    • Form W-9 01:07:33
    • Fringe Benefits 00:16:19, 00:18:38
    • Gross Proceeds Payment 00:22:16, 00:30:34
    • IRC 6050W 01:30:23
    • IRC Section 3406(a) 00:01:20
    • IRC Section 6041(a) 00:01:20
    • IRC Section 6109(a)(2) 00:01:20
    • ITIN 01:16:25
    • Limited liability company (LLC) 01:18:18, 01:18:54
    • Sole Proprietor 01:10:26, 01:12:49
    • Tax Exempt Organization Search Tool 01:21:43
    • Tax Gap 00:01:38
    • TIN 01:07:47
    • TIN Match Program 01:21:59

    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.

    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)

    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)

    Expense Reimbursement: Expense reimbursement is a method for paying employees back when they spend their own money on business-related expenses. These expenses generally occur when an employee is traveling for business but can occur in other work-related situations. (www.thebalancecareers.com)

    FATCA: FATCA was enacted in 2010 by Congress to target non-compliance by U.S. taxpayers using foreign accounts. FATCA requires foreign financial institutions (FFIs) to report to the IRS information about financial accounts held by U.S. taxpayers, or by foreign entities in which U.S. taxpayers hold a substantial ownership interest. (www.treasury.gov). FACTA (Fair and Accurate Credit Transactions Act) is an amendment to FCRA (Fair Credit Reporting Act ) that was added, primarily, to protect consumers from identity theft. The Act stipulates requirements for information privacy, accuracy and disposal and limits the ways consumer information can be shared.

    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)

    Fringe Benefits: An extra benefit supplementing an employee's salary, for example, a company car, subsidized meals, health insurance, etc.

    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.

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

    Form W-2: Form W-2 is an Internal Revenue Service tax form used in the United States to report wages paid to employees and the taxes withheld from them. Employers must complete a Form W-2 for each employee to whom they pay a salary, wage, or other compensation as part of the employment relationship. - Wikipedia (https://en.wikipedia.org/)

    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/)

    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.

    IRC 6050W : Section 6050W requires information returns to be made for each calendar year by merchant acquiring entities and third party settlement organizations with respect to payments made in settlement of payment card transactions and third party payment network transactions occurring in that calendar year.

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

    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."

    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.

    Form 1042-S: Form 1042-S is used to report amounts paid to foreign persons (including persons presumed to be foreign) who are subject to income tax withholding. For an individual taxpayer, Form 1042-S is a document provided to you (and the IRS) by the payer of the income reported.

    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-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 FromCooperatives, for each person to whom the cooperative has paidat least $10 in patronage dividends and other distributionsdescribed in section 6044(b), or from whom you withheld anyfederal income tax under the backup withholding rulesregardless of the amount of the payment.

    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.

    ITIN : An Individual Taxpayer Identification Number is a United States tax processing number issued by the Internal Revenue Service. It is a nine-digit number that begins with the number 9, and the 4th and 5th digits, also known as second section, range from 70 to 88, 90 to 92 and 94 to 99.

    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.

    Form 1099-R: Form 1099-R is a tax form from the Internal Revenue Service (IRS) for reporting distributions from annuities, profit-sharing plans, retirement plans, IRAs, insurance contracts, or pensions.

    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.

    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-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.

    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.

    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.

    Gross Proceeds Payment: When a business sells an asset, whether tangible or intangible, it receives a payment, which is the gross proceeds. The amount includes the costs of production and other costs and expenses related to the transaction.


    Guest Speaker

    • Steven Mercatante

    CPE Credit

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    IRS Credit

    Preparer Tax Identification Number