Forms 1099-NEC, MISC, K, and Other 1099s are Available for Tax Year 2022
Now that the fourth quarter of 2022 has begun employers should begin preparing for the end of the year. This means a lot of extra tasks and responsibilities for businesses. One of the most important is the required year-end filing with the IRS.
The IRS requires that businesses report payments that were made for a variety of different reasons throughout the year. Some of the most commonly used 1099s are the 1099-NEC, 1099-MISC, and 1099-K.
These forms are now available in TaxBandits for the 2022 tax year. Here is a helpful overview of these forms, when they are due, and any updates for 2022 that you need to be aware of.
An Overview of Form 1099-NEC for 2022
Form 1099-NEC is probably the most commonly used 1099 form. This is used to report all non-employee compensation payments of $600 or more to the IRS, it must also be distributed to the recipients of this compensation.
Non-employee compensation payments are made to individuals that are considered independent contractors, freelancers, and vendors rather than employees.
Form 1099-NEC has the earliest deadline for the 1099 forms, it must be filed with the IRS by January 31st. Additionally, the recipient copies must be furnished to the recipient by January 31st.
An Overview of Form 1099-MISC for 2022
While Form 1099-MISC hasn’t been used for reporting non-employee compensation since the 2019 tax year, it is still one of the most common 1099 forms. This form is used to report many different types of miscellaneous payments to the IRS.
The following payments of $600 or more should be reported on 1099-MISC:
- Awards and prizes
- Other income payments
- Medical and health care payments
- Payments to an attorney
- Crop insurance proceeds
- Cash paid from a notional principal contract to an individual, partnership, or estate
- Any fishing boat proceeds
- Section 409A deferrals
- Nonqualified deferred compensation
Exceptions to the minimum $600 rule:
- At least $10 was made in royalties in lieu of dividends or tax-exempt interest.
- Direct sale of at least $5,000 or more.
- If the tax is withheld under the backup withholding rule, even if it is less than $600.
The deadline to file Form 1099-MISC with the IRS is February 28th if you are planning to file paper copies and March 31st if you file electronically. Regardless, all recipient copies must be distributed by January 31st.
An Overview of Form 1099-K for 2022
Form 1099-K is used to report electronic payments from credit cards, debit cards, PayPal, Uber, Lyft, and more.
Entities that facilitate these transactions are required to report them using Form 1099-K. Payment Settlement Entities (PSEs), Third-party Settlement Organizations (TPSOs), and Merchant Acquiring Entities (MAEs) are all examples of the types of businesses that are required to file this form with the IRS. They are also required to provide a copy to the recipient of the payment.
There are some major updates to this form for 2022. Up until the recent changes, there was a threshold for reporting. This was 200 transactions and $20,000 in gross volume. The new requirement for reporting is just $600, without any threshold. This means any one transaction totaling $600 or more must be reported on Form 1099-K going forwards.
The deadline to file Form 1099-K with the IRS is February 28th if you are planning to file paper copies and March 31st if you file electronically. Regardless, all recipient copies must be distributed by January 31st.
An Overview of Forms 1099-R, INT, and DIV for 2022
There are no major changes to these forms for the 2022 tax year. Form 1099-R is used to report various types of distributions from retirement accounts. This includes pensions, annuities, IRAs, and more.
Form 1099-INT and 1099-DIV are primarily used by banks and financial institutions to report interest payments to recipients (INT) and distributions/dividend payments to investors (DIV).
All three of these forms are due to the IRS by March 31st (e-filing) or February 28th (paper-filing). All recipient copies must be distributed by January 31st.
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