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Easily E-File and Manage 1099 Forms Online Without the Hassle


How to Modify Chart of Accounts for 1099-MISC and 1099-NEC Filing in QuickBooks

You have the option to print and e-file your 1099-MISC and 1099-NEC using QuickBooks. There are a few actions you […]


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You have the option to print and e-file your 1099-MISC and 1099-NEC using QuickBooks. There are a few actions you can do right away to make sure your chart of accounts is properly mapped for both the 1099-MISC and 1099-NEC forms and reports before you start creating these forms.

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What You should need Before e-file Both Forms?

If you need to file both a 1099-NEC and a 1099-MISC and haven’t separated your accounts, only the following actions are necessary. When you create your 1099s in QuickBooks, the types of boxes you choose to have an impact on this. For contractor payments, the majority of businesses only choose non-employee compensation. You do not need to read the rest of this article because no adjustments are necessary for this situation. To prepare your books, you will need to make changes to your accounts and payments if you do need to choose other payment kinds to report. For help updating your company file, go to this article.

If Both Forms Need to be Filed

If both forms need to be submitted, The new form requires you to create a new expense account for each account that will be reported on the 1099-NEC or 1099-MISC if you need to submit both the 1099-NEC and 1099-MISC. Each form can only be used with a single account. After that, you must make a journal entry to transfer the amounts from one account to another after creating your new expense account in your QuickBooks file.

For example, if you have only one set of accounts that you have been using to pay your suppliers and you need to submit both forms, you will need to make a new list of accounts to report amounts to the new 1099-NEC form. To transfer the amounts from one account to another, you will then need to make journal entries.

Set up QuickBooks for the 1099-MISC and 1099-NEC forms

You must edit your chart of accounts to make sure separate accounts are available for each form to use if you paid 1099-MISC and 1099-NEC contractors and posted to the same account. Then, you may either create existing payments to the new accounts or write a journal entry to transfer amounts to show in the newly formed 1099-NEC or 1099-MISC accounts.

For your version of QuickBooks follow the steps:

Set up 1099-MISC and 1099-NEC forms in QuickBooks Online

Follow the below mentioned set up steps for 1099-MISC and 1099-NEC in QuickBooks Online:

Step 1: Create a 1099 Transaction Detail Report

Identify the amounts paid and which accounts they were sent to

  • First, You have to select Reports.
  • Find the 1099 Transaction Detail Report by searching.
  • Run the report and make that the 1099-NEC and 1099-MISC amounts are reflected in the correct accounts. You can map the accounts as you complete the 1099 process using this.
  • If either adds more details, you can use the 1099 Contractor Balance Detail or 1099 Contractor Balance Summary reports.

Step 2: Add a New Account

To keep track of the many payments, add a new account to your chart of accounts:

  • A chart of accounts can be found by going to Settings.
  • Then you have to choose New. You will either see a panel with the title new account or new category depending on how your account is displayed. For the following action, choose the option you see below.
Create a New Account in the New Account Panel
  • To select the type of account, choose from the Save account that is under the dropdown menu: Expense, Other Expense, or Cost of goods sold. You can choose one of the account type buttons above the dropdown to narrow the scope of account types.
  • Please take note that parent accounts are not indented in this dropdown menu, but subaccounts are. Find out more about subaccounts and parent accounts.
  • Choose the detail type that best fits the transactions you wish to track from the dropdown menu in the Tax form section.
  • In the Account name field, type a name. Federal Income Tax Withheld (ex. 1099-NEC)
  • Add a description if you choose in the Description field. When finished you have to select Save.
  • Repeat this procedure for every new account that needs to be reported on the 1099-NEC or 1099-MISC.
Create a New Account in the New Category Panel

You are creating a subaccount under an existing parent account if you see the new category panel. Change to accountant view if you need to add a new account type.

  • Enter a name for the category in the Category name field (subaccount). Federal Income Tax Withheld (ex. 1099-NEC)
  • Select Expense after clicking the Select category link and then choose next.
  • A new Expense subaccount can be chosen. Select the category if there is an arrow > next to it to view even more specific categories.
  • When finished you have to choose Save.
  • Repeat this procedure for every new account that needs to be reported on the 1099-NEC or 1099-MISC.

Step 3: Move the Payments to the New Account

You have the option of editing existing payments to the new accounts or creating a journal entry to move amounts to show in the newly created 1099-NEC or 1099-MISC accounts.

Add a Journal Entry
  • Begin by selecting Journal Entry after choosing New +.
  • To write an entry in your journal, complete the fields.
  • Choose Save and close or Save and new.
  • For each payment, you need to move, and repeat this process.

or

Edit Existing Contractor Payments

● First, You have to select Expenses.
● To find the contractor payments you need to edit and filter the transactions.
● Once the payment has been located, you have the option of selecting View/Edit to view the transaction or choosing a different account from the Category dropdown menu.

Step 4: Validate Your Changes

To validate the changes to your accounts you have to create a 1099 Transaction Detail Report.

  • You have to choose Reports and then you have to search for the 1099 Transaction Detail Report.
  • Then you will notice the changes that are reflected.

Set up 1099-MISC and 1099-NEC forms in QuickBooks Desktop

Step 1: Backup Your QuickBooks Desktop File

Make a backup of your QuickBooks Desktop file before you start making changes. You will need to restore this backup in order to access the forms and data from before 2020 if you need to make changes to the previous year’s forms. Once you map the new boxes on the new forms, the data from earlier years won’t display appropriately.

Step 2: Create a 1099 Summary Report

List the sums paid and the accounts they were sent to.

  • Select Vendors & Payables under Reports.
  • Select 1099 Detail or 1099 Summary.
  • Make sure the report is set up for the appropriate date range next to Dates at the top of the report because reports will default to the Last Calendar Year.
  • To identify the vendors and the transactions, use the 1099 Summary and 1099 Detail, respectively. Take a look at the totals below to see what amounts might need to be shifted.

Important: Previous reports will update and no longer include past-year filings after you make changes to your accounts or payments. Before making any changes, you might wish to print these reports for your keeping.

Your Chart of Accounts will need to be modified if you need to file both the 1099-MISC and 1099-NEC in order to make sure that the appropriate accounts are set up for each form.

Step 3: Create a New Account

To keep track of the many payments, add a new account to your chart of accounts.

  • Select the Chart of Accounts under Lists.
  • To create a new account, select the Account dropdown menu and then click New.
  • Choose between Other Expense and COGS as your account type, then click Continue.
  • Specify the Account Name and other information, including the Description, Notes, and Tax-line Mapping. Then you have to select Save & Close option.
  • Repeat this procedure for every new account that needs to be reported on the 1099-NEC or 1099-MISC.

Step 4: Move the Payments to the New Account

You have the option of editing existing payments to the new accounts or creating a journal entry to move amounts to show in the newly created 1099-NEC or 1099-MISC accounts.

Add a Journal Entry
  • First, You have to go to Company and then you have to select Make General Journal Entries.
  • To create an entry in your journal, complete the fields. When you are finished, make sure your debits and credits balance.
  • If there are still more entries to be made, choose Save & Close or Save & New.
  • For each payment, You need to move, and repeat this step.

Edit Existing Contractor Payments

  • First, You have to select Vendors and then click on Vendor Center.
  • Locate the transactions you need to update and select the vendor.
  • To edit the transaction, Double-click to open it.
  • Select Save & Close after you have finished making the changes.
  • For each payment, You need to change and repeat this procedure.

Step 5: Create a 1099 Summary Report

Run a 1099 Summary or 1099 Detail report to confirm the adjustments and ensure that the 1099-NEC and 1099-MISC show the correct amounts in each account.

  • Select Vendors & Payables under Reports.
  • Select 1099 Detail or 1099 Summary.
  • Make sure the report is set up for the appropriate date range next to Dates at the top of the report because reports will default to the Last Calendar Year.
  • The adjustments you made ought to be reflected.

Set up 1099-MISC and 1099-NEC forms in QuickBooks Desktop Mac

Step 1: Backup Your QuickBooks Desktop File

Make a backup of your QuickBooks Desktop for Mac file before you start making changes. You will need to restore this backup in order to access the forms and data from before 2020 if you need to make changes to the previous year’s forms. Once you map the new boxes on the new forms, the data from earlier years won’t display appropriately.

Step 2: Create a 1099 Summary Report

  • Find out how much was paid and to which accounts.
  • Vendors & Payables can be found under Reports.
  • Decide between the 1099 Summary and 1099 Detail.
  • The most recent calendar year will be used by default in reports. To make sure the report is configured for the proper date of execution, choose Customize. To choose a certain 1099 form type, you can modify the 1099 option.
  • Identify the vendors using the 1099 Summary, and the transactions using the 1099 Detail. To find out what amounts might need to be shifted, look over the totals below.

You must adjust your chart of accounts to ensure that the accounts are set up specifically for each form if you need to file both the 1099-MISC and 1099-NEC.

Step 3: Create a New Account

To track the separate payments you have to add a new account to your Chart of Accounts.

  • First, You have to go to lists, then you have to click on Chart of Accounts.
  • To create a new account you have to select the + button.
  • Then you have to select an account type of Expense, then click on Other Expense or on Cost of Goods Sold (COGS).
  • Enter the account name as well as information like the description, note, and tax line, and then you have to select OK.
  • Repeat this procedure for every new account that needs to be reported on the 1099-NEC.

Step 4: Move the Payments to the New Account

You have the option of editing current payments to the new accounts or creating a journal entry to transfer amounts to display in the newly formed 1099-NEC accounts.

Add a Journal Entry
  • You have to select Make General Journal Entries from the Company menu.
  • To write an entry in your journal, complete the fields. When you’re finished, make sure your debits and credits balance.
  • If there are still more entries to be made, choose Save & Close or Save & New.
  • For each payment, you need to move and then you have to repeat this step.
Edit Existing Contractor Payments
  • Begin by clicking on the Vendors then you have to click Vendor Center.
  • Select the vendor, then look for the transactions you want to edit.
  • To make changes, double-click on the transaction to open it.
  • Select save once you have finished editing.
  • To change each payment you have to repeat this procedure.

Step 5: Create a 1099 Summary Report

  • You have to go to Reports and from there you have to select Vendors and Payables.
  • Then you have to select either 1099 Detail or 1099 Summary.
  • Note: Reports will always use the most recent calendar year. To ensure that the report is set up for the proper run date, select Customize. Also, you can modify the 1099 option to specify a specific 1099 form type.
  • The changes you made ought to be reflected.

After reading the above blog, maybe your all doubts are cleared now. In this above blog, you will know about how to modify your chart of accounts for your 1099-MISC and 1099-NEC filing. In case you still face any issues related to this then you can connect with Dancing Numbers team via LIVE CHAT.

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Frequently Asked Questions

How to Change the 1099 Account Mapping in QuickBooks online?

● First, You have to go to the tab of Vendors and then you have to click on the Vendors Centers.
● Then you have to tap on the name of the vendor.
● After that, You have to go to the section of Tax settings and then for the 1099 section, You have to mark the box beside the Vendor eligible. Then click on OK.
● For other vendors that are eligible for 1099, You have to repeat the steps.

How to Adjust 1099 NEC in QuickBooks?

● At the top, You have to go to the File menu and then you have to select Printer Setup.
● From the drop-down arrow, You have to press the Form Name and then you have to scroll up.
● Now you have to tap the Align button and then you have to make the adjustment.
● To save the changes you have to click OK twice.

How to Change the 1099 Settings in QuickBooks?

● You have to go to Get paid and pay or Sales. Then you have to select Vendors.
● After that, You have to choose the vendor that you want to track and open their profile.
● Now click on Edit.
● For the 1099 checkbox, You have to select and check the Track payments and you can edit the 1099 settings.

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Frequently Asked Questions

 
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You need to click "Start" to Export data From QuickBooks Desktop using Dancing Numbers, and In the export process, you need to select the type you want to export, like lists, transactions, etc. After that, apply the filters, select the fields, and then do the export.

You can export a Chart of Accounts, Customers, Items, and all the available transactions from QuickBooks Desktop.


How can I Import in Dancing Numbers?

To use the service, you have to open both the software QuickBooks and Dancing Numbers on your system. To import the data, you have to update the Dancing Numbers file and then map the fields and import it.


How can I Delete in Dancing Numbers?

In the Delete process, select the file, lists, or transactions you want to delete, then apply the filters on the file and then click on the Delete option.


How can I import Credit Card charges into QuickBooks Desktop?

First of all, Click the Import (Start) available on the Home Screen. For selecting the file, click on "select your file," Alternatively, you can also click "Browse file" to browse and choose the desired file. You can also click on the "View sample file" to go to the Dancing Numbers sample file. Then, set up the mapping of the file column related to QuickBooks fields. To review your file data on the preview screen, just click on "next," which shows your file data.


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Dancing Numbers is SaaS-based software that is easy to integrate with any QuickBooks account. With the help of this software, you can import, export, as well as erase lists and transactions from the Company files. Also, you can simplify and automate the process using Dancing Numbers which will help in saving time and increasing efficiency and productivity. Just fill in the data in the relevant fields and apply the appropriate features and it’s done.

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Why should do you change the Employee status instead of deleting them on QuickBooks?

If you are unable to see the option to terminate an employee on your list of active employees on the company payroll, this mostly implies that they have some history. Thus, if you change the employee status instead of deleting it on QuickBooks, the profile and pay records remain in your accounting database without any data loss in your tax payments.


Is it possible to use the Direct Connect option to sync bank transactions and other such details between Bank of America and QuickBooks?

Yes, absolutely. You can use the Direct Connect Option by enrolling for the Direct Connect service which will allow you access to the small business online banking option at bankofamerica.com. This feature allows you to share bills, payments, information, and much more.


Why should do you change the Employee status instead of deleting them on QuickBooks?

If you are unable to see the option to terminate an employee on your list of active employees on the company payroll, this mostly implies that they have some history. Thus, if you change the employee status instead of deleting it on QuickBooks, the profile and pay records remain in your accounting database without any data loss in your tax payments.


What are the various kinds of accounts you could access in QuickBooks?

QuickBooks allows you to access almost all types of accounts, including but not limited to savings account, checking account, credit card accounts, and money market accounts.

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