Compliance Update - December, 2019
IRS Finalized 1099-NEC & 1099-MISC for TY2020
The IRS has released the finalized form layouts the 1099-MISC & 1099-NEC for Tax year 2020. At this point, a brief instruction set is included on each form layout but the complete instructions, for Tax Year 2020, are still in a draft status.
IRS Releases Forms 1099-MISC & 1099-NEC
When Do Changes Go Into Effect?
Both the revised 1099-MISC and the new 1099-NEC are scheduled to go into effect on January 1, 2020.
What is the Impact of this Change?
There are no changes required for Tax Year 2019 reporting - which are 2019 tax forms that are printed/mailed/filed in Calendar Year 2020. However, the upcoming Corporate Suite software release, estimated to be released by the end of December, will incorporate the 1099-MISC & 1099-NEC finalized forms for Tax Year 2020. This means that any company entering, or importing, these 2020 forms types will need to be aware of, and setup for, the form changes. Primarily, this will be any company performing transactional or Year-To-Date (YTD) imports. A list of items to prepare for are below:
- Security Access Groups - Update Access Groups to incorporate the new 1099-NEC form.
- Import Files - 1099-NEC data will need to be broken out from the 1099-MISC and placed in a separate import file as it is a different form type now.
- Import Maps - 1099-MISC import maps will need to be updated. 1099-NEC import maps will need to be created.
- Scheduled/Automated Import Jobs - Scheduled import jobs will need to be updated to use the 1099-NEC import map and file location / file mask.