Changes to the 1099 process for filing year 2023

Changes to the 1099 process for filing year 2023

Note: Your 1099 e-file may be returned by the IRS if your information is incorrect (if you filed multiple forms at once, all of those forms will get returned in bulk). The top errors are as follows: 

  • The legal name and tax ID of the payer (company filed on behalf of) do not match the IRS records.
  • One or more contractors have a missing or incorrect digit in their zip code.
  • An invalid state (Canada, for example) has been entered.
  • Business name is in an invalid format.

The primary admin will receive an email and in-product messaging when the 1099 has been declined. You may be penalized if you do not resubmit by the deadline. Please “void” the 1099, correct the error(s) by restarting the filing process (your info is still saved), and re-file at no additional cost. Learn more

Note: 1099 e-filing is included at no additional charge for the following: QuickBooks Bill Pay Premium or Elite; QuickBooks Online Payroll Core, Premium, or Elite; and QuickBooks Contractor Payments. When you file, you will bypass the payment page and automatically land on the confirmation page.

We wanted to let you know about some exciting changes to the 1099 filing process for tax year 2023. We are making improvements and fixing issues to make your tax time as smooth as possible. The new updates will save you time and effort, allowing you to keep your business moving forward smoothly.

What’s changing?

In an effort to enhance the QuickBooks Online user experience, we've introduced a series of exciting new updates to improve our 1099 filing process for tax year 2023.

The updates include the following:

  • Split billing: Regardless of who pays for your QuickBooks subscription, you and your client can now control who pays for 1099 e-filing, allowing more billing flexibility.

  • Reports: Two new reports have been added that you can access only through the 1099 flow: "Accounts used to pay vendors report" and "Transactions & accounts organized by vendors report." We've also added columns in the reports for payment method (cash, credit card) and payment account type (bank, credit card). You can still access all previous reports in the 1099 reports list.
  • Flow: Based on user feedback, the existing 1099 filing flow is also changing. Take a look at this video for an overview of the new flow.
  • 1099 downloads: On the Taxes tab, you can download all the 1099 filings from this year and last year. You can download them one by one or all of them at once. You will also be able to see a summary of everything you have filed this year.
  • 1099 e-corrections: Starting in February 2024, for the first time in QuickBooks Online, you can e-file corrected 1099. Go to Taxes and the 1099 filings tab to start correcting forms. Check back to this article for instructions in February.

What are the changes regarding billing and split billing?  

Please note that 1099 e-filing is included at no additional charge for the following subscriptions:

For accountant-paid subscriptions, clients now have the option to pay for their 1099 e-filing by adding their own payment method, without any impact on their subscriptions. 

For client-paid subscriptions, accountants can pay for e-filing using their preferred payment method without any impact on their clients’ subscriptions. This provides flexibility for the client and accountant regarding who pays for 1099 e-filings.

To support the continued improvements, there are areas we can no longer support:

  • We will no longer support print alignment, and any formatting will have to be done in your browser print settings.
  • We are currently experiencing issues with bulk un-tracking contractors for 1099s. We are working to improve the feature and apologize for any inconvenience caused.

Here are some additional things to remember:

  • E-file is now mandatory for users with more than 10 forms to file across 1099s and W-2s combined.
  • The correction filing method must align with the original filing method. For example, e-filed forms require e-corrections.
  • Follow the IRS website for additional changes

We appreciate your continued commitment to QuickBooks Online. Please leave us feedback if you have any questions or comments.

Thank you,

Ted Callahan

This information is intended to outline general product direction, but represents no obligation and should not be relied on in making a purchasing decision. Additional terms, conditions and fees may apply with certain features and functionality. Eligibility criteria may apply. Product offers, features, functionality are subject to change without notice.

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