MENUMENU
  • FREE RESOURCES
        • Accounts Payable
          Finally! The trick to securing greater T&E compliance
          Benefits
          Rooting out folks who don’t belong on your health plan: A 6-point dependent audit checklist
          IT
          3 costly misconceptions about biz email compromise
          Credit and Collections
          Collecting via email: 4 must-make moves in your subject line
          Accounts Payable
          5 Tough-to-spot signs that an invoice is fake
  • PREMIUM CONTENT
        • Staff management
          120 Proven Communications Tips for Today’s CFO
        • Payroll
          Handling Nonexempt Employee Pay: Stay Compliant and Avoid DOL Audits
          Accounts Payable
          T&E Best Practices: Complete Guide to Ensure Compliance
          Payroll
          Payroll Best Practices: 4 Ways to Save Time and Money
        • Staff management
          Email Best Practices: A 6-Question Quiz
          Staff management
          Innovative Communications Strategies: An Email Case Study
          Staff management
          A 5-part Framework for Successful Workplace Communications
        • SEE MORE
          PREMIUM RESOURCES
  • CORONAVIRUS RESOURCES
  • LOGIN
  • SIGN UP FREE

CFO Daily News

MENUMENU
  • FREE RESOURCES
        • Accounts Payable
          Finally! The trick to securing greater T&E compliance
          Benefits
          Rooting out folks who don’t belong on your health plan: A 6-point dependent audit checklist
          IT
          3 costly misconceptions about biz email compromise
          Credit and Collections
          Collecting via email: 4 must-make moves in your subject line
          Accounts Payable
          5 Tough-to-spot signs that an invoice is fake
  • PREMIUM CONTENT
        • Staff management
          120 Proven Communications Tips for Today’s CFO
        • Payroll
          Handling Nonexempt Employee Pay: Stay Compliant and Avoid DOL Audits
          Accounts Payable
          T&E Best Practices: Complete Guide to Ensure Compliance
          Payroll
          Payroll Best Practices: 4 Ways to Save Time and Money
        • Staff management
          Email Best Practices: A 6-Question Quiz
          Staff management
          Innovative Communications Strategies: An Email Case Study
          Staff management
          A 5-part Framework for Successful Workplace Communications
        • SEE MORE
          PREMIUM RESOURCES
  • CORONAVIRUS RESOURCES
  • Accounts Payable
  • Credit and Collections
  • Payroll
  • Accounting
  • Benefits
  • Finance Technology
  • More
    • Employment Law
    • Strategy
    • Policy and Culture
    • Fraud
    • Payments and Transactions
    • Budgeting and Forecasting
    • Banking
    • Staff Management
    • Cost Control
    • Supply Chain
    • IT

Form 1099-NEC excluded from IRS’s combined filing program

Form 1099-NEC excluded from IRS’s combined filing program
Alyssa Evans
by Alyssa Evans
October 13, 2020
  • Accounting
3 minute read
  • SHARE ON

Though the 1099-NEC was revived to simplify year-end filing, there’s one aspect that will make things more complicated for your finance team.

IRS recently released Publication 1220, Specifications for Electronic Filing of Forms 1097, 1098, 1099, 3921, 3922, 5498, and W-2G for Tax Year 2020. And it includes a notable distinction between submitting 1099-NEC and other 1099s.

No combined filing

In the publication, the Service doesn’t include Form 1099-NEC in its 1099 Combined Federal/State Filing (CF/SF) Program for 2020.

That means any 1099-NECs you file electronically using the Service’s FIRE System won’t automatically be forwarded to states. Your finance team will have to take care of them separately.

Note, though, that the 1099-MISC is still part of the CF/SF program. In fact, you can share with your team that the forms included for 2020 are:

  • 1099-B
  • 1099-DIV
  • 1099-G 1099-INT
  • 1099-K
  • 1099-MISC
  • 1099-OID
  • 1099-PATR
  • 1099-R, and
  • 5498.

Despite the majority of 1099s being included in the combined filing program, it’s clear your finance team will have to devote some extra effort to separately filing 1099-NECs with states this coming year-end. So, it’d be smart for them to start developing a solid plan now.

4 key considerations

Here are a few things you should encourage them to consider:

1. The research: As your team knows, different states have different requirements for filing 1099s. Some don’t require your company to send any of them; others mandate you file all of them; others still want just the 1099s that report withholding.

While year-end’s still a few months out, your finance team should make a list of all the states that are relevant to your company. Then they can dig in and figure out what each of their individual requirements are.

2. The who: After, your team must consider who will handle the additional state filing. Should the job be split up equally between staffers? Or would it make more sense to designate a specific staffer or two to handle the task?

Estimating how many labor hours it’ll take, based on how many forms you have to file with different states, could help fuel your decision here.

3. The when: Since filing with states requires another step in the year-end process, your team should think about when they’ll file with states (at the same time as IRS filings, after IRS filings, etc.).

Most states’ deadlines mimic the federal deadlines, so this will come down to your team’s preference. They may find it easier to handle returns with IRS first, then worry about states later. Or, oppositely, they may want to process 1099s for IRS and the state in tandem. The key is to come up with one set process, so nothing gets missed.

4. The alternative: Of course, if that extra work is something your company wants to avoid altogether, it can look to external vendors that offer 1099 filing services.

Along with saving your team a lot of time, passing the task to a trusted service provider could lower your risk of year-end filing errors that spur costly penalties,

Alyssa Evans
Alyssa Evans
Alyssa, a member of the CFO Daily News staff, has written extensively on business and finance for several years. She has produced content for accounts payable professionals and finance executives and has developed whitepapers and infographics for the finance and accounting industry.

Keep Up To Date with the Latest Finance News

With CFO Daily News arriving in your inbox, you will never miss critical stories on accounting, benefits, payroll & employment law strategies.

Sign up for a free CFO Daily News membership and get our newsletter!
  • This field is for validation purposes and should be left unchanged.
CFO Daily News Logo
  • ABOUT CFO DAILY NEWS
  • ADVERTISE WITH US
  • WRITE FOR US
  • CONTACT
  • Accounting
  • Benefits
  • Payroll
  • Policy and Culture
  • Employment Law
  • Fraud
  • Finance Technology
  • Accounts Payable
  • Credit and Collections
  • Strategy
  • Payments and Transactions
  • Budgeting and Forecasting
  • Banking
  • Staff Management
  • Cost Control
  • Supply Chain
  • IT

CFO Daily News, part of the SuccessFuel Network, provides the latest Finance and employment law news for Finance professionals in the trenches of small-to-medium-sized businesses. Rather than simply regurgitating the day’s headlines, CFO Daily News delivers actionable insights, helping Finance execs understand what Finance trends mean to their business.

Privacy Policy Terms of Service
Copyright © 2021 SuccessFuel

WELCOME BACK!

Enter your username and password below to log in

Forget Your Username or Password?

Reset Password

Lost your password? Please enter your username or email address. You will receive a link to create a new password via email.

Log In

preloader