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Fill in a Valid 1099 Nec Form

The 1099-NEC form is used to report nonemployee compensation to the IRS. This form is essential for businesses that pay independent contractors or freelancers. Understanding its requirements can help ensure compliance and avoid potential penalties.

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Document Sample

Attention:

Copy A of this form is provided for informational purposes only. Copy A appears in red, similar to the official IRS form. The official printed version of Copy A of this IRS form is scannable, but the online version of it, printed from this website, is not. Do not print and file copy A downloaded from this website; a penalty may be imposed for filing with the IRS information return forms that can’t be scanned. See part O in the current General Instructions for Certain Information Returns, available at www.irs.gov/form1099, for more information about penalties.

Please note that Copy B and other copies of this form, which appear in black, may be downloaded and printed and used to satisfy the requirement to provide the information to the recipient.

To order official IRS information returns, which include a scannable Copy A for filing with the IRS and all other applicable copies of the form, visit www.IRS.gov/orderforms. Click on Employer and Information Returns, and we’ll mail you the forms you request and their instructions, as well as any publications you may order.

Information returns may also be filed electronically using the IRS Filing Information Returns Electronically (FIRE) system (visit www.IRS.gov/FIRE) or the IRS Affordable Care Act Information Returns (AIR) program (visit www.IRS.gov/AIR).

See IRS Publications 1141, 1167, and 1179 for more information about printing these tax forms.

7171

VOID

CORRECTED

PAYER’S name, street address, city or town, state or province, country, ZIP

OMB No. 1545-0116

or foreign postal code, and telephone no.

Form 1099-NEC

Nonemployee

(Rev. January 2022)

Compensation

For calendar year

PAYER’S TIN

RECIPIENT’S TIN

Nonemployee compensation

Copy A

For Internal Revenue

RECIPIENT’S name

Payer made direct sales totaling $5,000 or more of

Service Center

consumer products to recipient for resale

File with Form 1096.

For Privacy Act and

Paperwork Reduction Act

Street address (including apt. no.)

Notice, see the current

Federal income tax withheld

General Instructions for

Certain Information

City or town, state or province, country, and ZIP or foreign postal code

Returns.

State tax withheld

6 State/Payer’s state no.

7 State income

Account number (see instructions)

2nd TIN not.

Form 1099-NEC (Rev. 1-2022)

Cat. No. 72590N

www.irs.gov/Form1099NEC

Department of the Treasury - Internal Revenue Service

Do Not Cut or Separate Forms on This Page — Do Not Cut or Separate Forms on This Page

	VOID	CORRECTED
PAYER’S name, street address, city or town, state or province, country, ZIP						OMB No. 1545-0116
or foreign postal code, and telephone no.						Form 1099-NEC
						Form 1099-NEC	Nonemployee
							Nonemployee
						(Rev. January 2022)	Compensation
						For calendar year
						20
PAYER’S TIN	RECIPIENT’S TIN		1	Nonemployee compensation			Copy 1
			$				Copy 1
			$				For State Tax
RECIPIENT’S name			2	Payer made direct sales totaling $5,000 or more of			For State Tax
				consumer products to recipient for resale			Department

			3
Street address (including apt. no.)
Street address (including apt. no.)
			4	Federal income tax withheld
City or town, state or province, country, and ZIP or foreign postal code			$
			5	State tax withheld	6 State/Payer’s state no.		7 State income
			$				$
Account number (see instructions)			$				$
			$				$
Form 1099-NEC (Rev. 1-2022)		www.irs.gov/Form1099NEC				Department of the Treasury - Internal Revenue Service

CORRECTED (if checked)

PAYER’S name, street address, city or town, state or province, country, ZIP				OMB No. 1545-0116
or foreign postal code, and telephone no.				Form 1099-NEC
				Form 1099-NEC	Nonemployee
					Nonemployee
				(Rev. January 2022)	Compensation
				For calendar year
				20

PAYER’S TIN	RECIPIENT’S TIN	1 Nonemployee compensation			Copy B
		$			For Recipient
RECIPIENT’S name		2 Payer made direct sales totaling $5,000 or more of			This is important tax
RECIPIENT’S name		2 Payer made direct sales totaling $5,000 or more of			information and is being
		consumer products to recipient for resale			information and is being
		consumer products to recipient for resale			furnished to the IRS. If you are
					furnished to the IRS. If you are
		3			required to file a return, a
		3			negligence penalty or other
Street address (including apt. no.)

					sanction may be imposed on
		4 Federal income tax withheld			you if this income is taxable
		4 Federal income tax withheld			and the IRS determines that it
City or town, state or province, country, and ZIP or foreign postal code		$			and the IRS determines that it
		$			has not been reported.
		5 State tax withheld	6 State/Payer’s state no.		7 State income
		$			$
Account number (see instructions)		$			$
		$			$
Form 1099-NEC (Rev. 1-2022)	(keep for your records)	www.irs.gov/Form1099NEC		Department of the Treasury - Internal Revenue Service

Instructions for Recipient

You received this form instead of Form W-2 because the payer did not consider you an employee and did not withhold income tax or social security and Medicare tax.

If you believe you are an employee and cannot get the payer to correct this form, report the amount shown in box 1 on the line for “Wages, salaries, tips, etc.” of Form 1040, 1040-SR, or 1040-NR. You must also complete Form 8919 and attach it to your return. For more information, see Pub. 1779, Independent Contractor or Employee.

If you are not an employee but the amount in box 1 is not self- employment (SE) income (for example, it is income from a sporadic activity or a hobby), report the amount shown in box 1 on the “Other income” line (on Schedule 1 (Form 1040)).

Recipient’s taxpayer identification number (TIN). For your protection, this form may show only the last four digits of your TIN (social security number (SSN), individual taxpayer identification number (ITIN), adoption taxpayer identification number (ATIN), or employer identification number (EIN)). However, the issuer has reported your complete TIN to the IRS.

Account number. May show an account or other unique number the payer assigned to distinguish your account.

Box 1. Shows nonemployee compensation. If the amount in this box is SE income, report it on Schedule C or F (Form 1040) if a sole proprietor, or on Form 1065 and Schedule K-1 (Form 1065) if a partnership, and the recipient/partner completes Schedule SE (Form 1040).

Note: If you are receiving payments on which no income, social security, and Medicare taxes are withheld, you should make estimated tax payments. See Form 1040-ES (or Form 1040-ES (NR)). Individuals must report these amounts as explained in these box 1 instructions. Corporations, fiduciaries, and partnerships must report these amounts on the appropriate line of their tax returns.

Box 2. If checked, consumer products totaling $5,000 or more were sold to you for resale, on a buy-sell, a deposit-commission, or other basis. Generally, report any income from your sale of these products on Schedule C (Form 1040).

Box 3. Reserved for future use.

Box 4. Shows backup withholding. A payer must backup withhold on certain payments if you did not give your TIN to the payer. See Form W-9, Request for Taxpayer Identification Number and Certification, for information on backup withholding. Include this amount on your income tax return as tax withheld.

Boxes 5–7. State income tax withheld reporting boxes.

Future developments. For the latest information about developments related to Form 1099-NEC and its instructions, such as legislation enacted after they were published, go to www.irs.gov/Form1099NEC.

Free File Program. Go to www.irs.gov/FreeFile to see if you qualify for no-cost online federal tax preparation, e-filing, and direct deposit or payment options.

	VOID	CORRECTED
PAYER’S name, street address, city or town, state or province, country, ZIP						OMB No. 1545-0116
or foreign postal code, and telephone no.						Form 1099-NEC
						Form 1099-NEC	Nonemployee
							Nonemployee
						(Rev. January 2022)	Compensation
						For calendar year
						20
PAYER’S TIN	RECIPIENT’S TIN		1	Nonemployee compensation			Copy 2
			$				Copy 2
			$				To be filed with
RECIPIENT’S name			2	Payer made direct sales totaling $5,000 or more of			To be filed with
				consumer products to recipient for resale			recipient’s state
							income tax
			3				income tax
			3				return, when
Street address (including apt. no.)							return, when
Street address (including apt. no.)							required.
			4	Federal income tax withheld
City or town, state or province, country, and ZIP or foreign postal code			$
			5	State tax withheld	6 State/Payer’s state no.		7 State income
			$				$
Account number (see instructions)			$				$
			$				$
Form 1099-NEC (Rev. 1-2022)		www.irs.gov/Form1099NEC				Department of the Treasury - Internal Revenue Service

	VOID		CORRECTED
PAYER’S name, street address, city or town, state or province, country, ZIP						OMB No. 1545-0116
or foreign postal code, and telephone no.						Form 1099-NEC
						Form 1099-NEC	Nonemployee
							Nonemployee
						(Rev. January 2022)	Compensation
						For calendar year
						20
PAYER’S TIN	RECIPIENT’S TIN			1 Nonemployee compensation			Copy C
				$			Copy C
				$			For Payer
RECIPIENT’S name				2 Payer made direct sales totaling $5,000 or more of			For Payer
RECIPIENT’S name				2 Payer made direct sales totaling $5,000 or more of
				consumer products to recipient for resale			For Privacy Act and
							For Privacy Act and
				3			Paperwork Reduction
				3			Act Notice, see the
							Act Notice, see the
Street address (including apt. no.)							current General
							Instructions for Certain
				4 Federal income tax withheld			Instructions for Certain
				4 Federal income tax withheld			Information Returns.
City or town, state or province, country, and ZIP or foreign postal code				$
				5 State tax withheld	6 State/Payer’s state no.		7 State income
				$			$
Account number (see instructions)			2nd TIN not.	$			$
				$			$
Form 1099-NEC (Rev. 1-2022)		www.irs.gov/Form1099NEC				Department of the Treasury - Internal Revenue Service

Instructions for Payer

To complete Form 1099-NEC, use:

•The current General Instructions for Certain Information Returns, and

•The current Instructions for Forms 1099-MISC and 1099-NEC.

To order these instructions and additional forms, go to www.irs.gov/EmployerForms.

Caution: Because paper forms are scanned during processing, you cannot file certain Forms 1096, 1097, 1098, 1099, 3921, or 5498 that you print from the IRS website.

Filing and furnishing. For filing and furnishing instructions, including due dates, and to request filing or furnishing extensions, see the current General Instructions for Certain Information Returns.

Need help? If you have questions about reporting on Form 1099-NEC, call the information reporting customer service site toll free at 866-455-7438 or 304-263-8700 (not toll free). Persons with a hearing or speech disability with access to TTY/TDD equipment can call 304-579-4827 (not toll free).

Document Information

Fact Name	Details
Purpose of Form	The 1099-NEC form is used to report nonemployee compensation. This includes payments made to independent contractors and freelancers.
Copy A Information	Copy A of the 1099-NEC is provided for informational purposes only and appears in red. It must not be printed from the IRS website as it is not scannable.
Penalties for Incorrect Filing	Filing a non-scannable version of Copy A with the IRS may result in penalties. It is important to use the official printed version for filing.
Recipient's Responsibility	Recipients must report the income shown on the 1099-NEC form on their tax returns. If they believe they are misclassified as nonemployees, they should take appropriate action.
State-Specific Requirements	Some states have specific requirements for filing 1099-NEC forms. For example, California requires a state-specific form to be filed along with the federal form.
Electronic Filing Options	Taxpayers can file 1099-NEC forms electronically using the IRS FIRE system. This is a convenient option for many businesses.

1099 Nec - Usage Guidelines

Filling out the 1099-NEC form is a crucial step in reporting nonemployee compensation to the IRS. After completing this form, you will need to distribute the appropriate copies to the recipient and file the form with the IRS. It’s essential to ensure all information is accurate to avoid any penalties.

Obtain the Form: Download the 1099-NEC form from the official IRS website or order printed copies directly from the IRS.
Fill in the Payer Information: Enter your name, address, and taxpayer identification number (TIN) in the designated fields.
Provide Recipient Information: Input the recipient's name, address, and TIN. Make sure all details are correct.
Report Nonemployee Compensation: In Box 1, write the total amount of nonemployee compensation paid to the recipient during the calendar year.
Complete Additional Boxes: If applicable, fill in Boxes 2 through 7 for any direct sales, federal tax withheld, state tax withheld, and other relevant information.
Check for Corrections: If this is a corrected form, be sure to check the “CORRECTED” box.
Sign and Date the Form: Ensure that the form is signed and dated by the payer, confirming the accuracy of the information provided.
Distribute Copies: Send Copy B to the recipient and keep Copy C for your records.
File with the IRS: Submit Copy A of the form along with Form 1096 to the IRS, or file electronically through the IRS FIRE system.

After completing these steps, keep a copy for your records and ensure that the recipient receives their copy in a timely manner. This process helps maintain compliance with IRS regulations and ensures that all parties are informed about their tax obligations.

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Dos and Don'ts

Things to Do When Filling Out the 1099-NEC Form:

Use the official IRS form for filing. Download it from the IRS website to ensure it is scannable.
Provide accurate taxpayer identification numbers (TINs) for both the payer and recipient.
Include all required information, such as nonemployee compensation and any state taxes withheld.
File the form by the deadline to avoid penalties.
Keep a copy of the completed form for your records.

Things to Avoid When Filling Out the 1099-NEC Form:

Do not print and file Copy A downloaded from the IRS website, as it may not be scannable.
Avoid leaving any boxes blank that require information.
Do not forget to provide the recipient with their copy of the form.
Do not mix up the payer's and recipient's information.
Do not ignore the filing requirements if you are unsure about the income reporting.

Common mistakes

Incorrectly filling in the payer's information: Many people fail to provide accurate details about the payer, such as the name, address, or taxpayer identification number (TIN). This can lead to processing delays or penalties.
Misreporting the recipient's TIN: Some individuals mistakenly enter the wrong TIN for the recipient. This error can cause issues with the IRS and may require additional steps to correct.
Forgetting to check the box for direct sales: If the payer made direct sales totaling $5,000 or more to the recipient for resale, this box should be checked. Failing to do so can lead to confusion about the nature of the payments.
Neglecting to report federal or state tax withheld: It's crucial to include any federal or state taxes withheld on the form. Omitting this information may lead to discrepancies in tax records.
Using a non-scannable version of Copy A: Some individuals print the online version of Copy A, which is not scannable. This mistake can result in penalties for filing an unscannable form with the IRS.

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