Tax season is just around the corner, and that means getting your business’ financials together for tax filing. If you’re using QuickBooks Online, a lot of this functionality is built right into the software. But you’ll need to understand how to use it in order to take full advantage of it.
When it comes to tax reporting, one common area of confusion for small business owners is the preparation and filing of 1099-MISC forms. What exactly is a 1099? Does your business need to file one? If so, how can QuickBooks Online expedite the process?
In this week’s installment in our QuickBooks Online tutorial series, we’ll answer all of these questions and more.
Disclaimer: This article is for general informational purposes, and is not intended as a substitute for personalized and/or professional legal, tax, investment, financial, or other business advice. If you have tax-related questions, it’s important to speak to a professional who can assess your particular situation and offer personalized assistance.
What is a 1099-MISC?
The series of 1099 forms available via the IRS website are classified by the IRS as a so-called “information return.”
Generally speaking, 1099 forms are used to classify various types of income which are not paid as part of a salary or wages. While there are a number of different kind of 1099 forms out there, including 1099s for dividends, government payments, retirement account withdrawals, and debt cancellations, people often use “1099” as a shorthand for referring to the 1099-MISC.
When someone is an employee and receives either a salary or wages, this information is reported on IRS Form W-2. Increasingly, though, businesses are opting to hire independent contractors rather than taking on full-time employees. When a business pays a contractor, those funds are reported on IRS Form 1099-MISC.
According to the IRS website, a 1099-MISC form must be filed for each person to whom your business paid more than $600 in exchange for services.
How to Prepare, Print, and File your 1099s
If you’ve paid a number of contractors throughout the year for various work, attempting to prepare and file 1099-MISC forms for each of them individually would be incredibly time consuming. With QuickBooks Online, though, the process is relatively quick and simple.
If you’ve paid a number of contractors throughout the year for various work, attempting to prepare and file 1099-MISC forms for each of them individually would be incredibly time consuming. With QuickBooks Online, though, the process is relatively quick and simple:
- Log into QuickBooks Online. Click the Expenses menu, and then select Vendors.
- Click the Prepare 1099s option. If you’re just getting started, you’ll want to select Let’s Get Started. If you’re continuing from where you left off, click the Continue Your 1099s option. QuickBooks Online will walk you through the necessary steps to prepare your 1099 forms. This includes choosing the type of payments that are relevant for individual contractors. If you’re unsure about any of the steps in this process, it’s a good idea to speak with your accountant, tax advisor, or another professional for clarification.
- Review the list of 1099s. You’ll then have the opportunity to review the list of 1099s you’ve prepared. If there’s information missing for one or more of your contractors, their name will be highlighted in red. You’ll also see a warning message at the top of your screen, prompting you to fill in the necessary information.
- When you’re done, you can click Finish Preparing 1099s.
You’ll now have the option to either E-file your 1099 forms, or print them out and mail them in yourself. In either case, you’ll need to print out and mail copies of the forms to your contractors.
That’s it! You’ve successfully prepared, printed, and filed your 1099s in QuickBooks Online.
Getting Your Overdue 2018 Invoices Paid
While filing 1099s isn’t all that time-consuming thanks to QuickBooks Online, we can’t say the same when it comes to getting your overdue invoices paid. Particularly when tax time comes around and you’re reviewing your 2018 end of year numbers, it can be incredibly frustrating to see how many outstanding invoices still require payment.
Unfortunately, sending out overdue invoice notifications is an area where QuickBooks is lacking. The only way to accomplish this involves sending out the notifications manually, one by one. It’s not possible to schedule them automatically. Additionally, there’s no easy way to add a late fee to overdue invoices.
Meanwhile, Biller Genie offers all of this functionality and more. Biller Genie integrates seamlessly with QuickBooks Online. No need to switch software providers or migrate data: Biller Genie takes care of everything!
When you sign up for your free Biller Genie account, you’ll be able to schedule automated email invoice reminders, overdue notifications, late fees, and more. This can save you hours of time and get your invoices paid faster than ever. Plus, Biller Genie offers a whole host of other exciting features, including a secure online payment portal where your customers can access prior invoices and make easy online payments.
Want to get those outstanding invoices paid now? Sign up for your free Biller Genie account today!