1099 e-filing for accountants and their clients

1099 e-filing for accountants and their clients

NEW UPDATE: As of 1/23/2023, we are implementing a change so that firm-billed clients without a Payroll or Contractor Payments subscription can add their own payment method and proceed with e-filing their 1099 without requiring their accountant to take action. With this fix, your client will be charged $4.99 per form when they e-file.

Context: During the 1099 season, QuickBooks® users without an integrated QuickBooks Online Payroll or Contractor Payments subscription can purchase a 1099 e-filing service from QuickBooks. This service results in a one-time charge, using the payment method on file for the client. Any user with an integrated QuickBooks Online Payroll or Contractor Payments services have e-filing included in their subscription fee.

What changed this year:

In 2023, including tax-year 2022, all of 1099 e-filings go through QuickBooks Online, instead of going through Intuit Online Payroll (IOP) or Intuit Full Service Payroll (IFSP). This change allows a user to prepare and file a 1099 without ever leaving QuickBooks Online, reducing the steps required to prepare and file 1099 forms.

Implication for firm-billed/wholesale billing clients without a Payroll or Contractor Payments subscription:

The payment method on file is the payment method that gets charged for the 1099 e-filing service. For wholesale billing (“Bill My Firm”) clients, this means that the accountant’s payment method is the one that will be charged. As a result, only accountants themselves can purchase this e-filing service. Accountants can stay in control of what they get charged, and their clients will not see the price of the service, giving more flexibility to the accountants regarding what they charge for this service.

What this means for your wholesale clients without a Payroll or Contractor Payments subscription:

Your clients will be able to handle the whole preparation of the 1099 forms on their own (steps 1-4). Their data will be saved progressively as they move from one step to the next.

The detailed steps 1-4 can be found in this video and this article.

However, when they reach step 5, they will have the ability to ask their accountants to take action and file for them or E-file or purchase the print kit themselves.

 Note that your client can elect to print the 1099 forms directly, at no charge.

What this means for you:

You may be asked to sign in to your client’s books and file on their behalf at step 5, after selecting the appropriate product for your needs. You won’t have to re-do the work your client has already done, you can go directly to step 5 and proceed with e-filing.

Alternatively, you may subscribe your client to QuickBooks Contractor Payments in Quickbooks Online for Accountants. To do this, log into your QuickBooks Online for Accountants tool ; and go to “Clients and subscriptions” under the settings menu. Click on “Client actions” next to the client you want to add Contractor Payments for.

QuickBooks Contractor Payments is a subscription product: you will be charged on a monthly basis, so you would have to cancel the subscription if your client no longer needs it. QuickBooks Contractor Payments is $10.50/mo (with ProAdvisor Preferred Pricing) for up to 20 contractors paid through direct deposit, and an extra $2/contractor/mo for each additional contractor after the first 20.

Steps for e-filing a 1099 through QuickBooks for your clients:

  • Clients can choose to E-file themselves, E-file with an accountant, or use Intuit’s 1099 print kit, which includes pre-printed forms and secure envelopes.
  • When on step 5:
    • If the user chooses to let their accountants file, users should complete steps 1-4 and notify their accountant that they need assistance with purchasing E-file or the print kit.  No action is needed from the user on step 5.
    • If the users choose to file themselves, complete step 5 by choosing “E-file for me” and a billing screen will  be prompted for them to put in their billing information.

Step 1:

Step 2:

Step 3:

Step 4:

Step 5:

1099 ready to file

As an accountant logging in your client’s books, on step 5 you would see the same view as above.  Just choose “E-file for me” to complete your client’s 1099s.