QuickBooks 2005: The Missing Manual

1099s

In QuickBooks, paying independent contractors is no different than paying other vendors. You enter bills from your independent contractors and then you pay those bills. No messy payroll transactions; no fuss with benefits or other regulatory requirements. But at the end of the year, you do have to generate 1099s for your independent workers.

If you set up QuickBooks to track 1099 payments (page 157) and your contractors as 1099 vendors (page 465), generating 1099s is a piece of cake. But before you push a stack of 1099 forms through your printer, it's a good idea to make sure your records are up-to-date and accurate.

Generating 1099 Reports

To review the amounts you've paid to 1099 vendors, choose Reports→Vendors & Payables, and then choose either of the following reports:

• 1099 Summary.. This report includes each vendor you've set up as a 1099 vendor and the total amount that you've paid the vendor. If any amount looks questionable, just double-click it to display the transactions for the vendor. Although the report lists only the vendors you set up as eligible for 1099 status, you can modify it to make sure you haven't left any 1099 vendors out, as demonstrated in Figure 15-5.

  Note

  The federal government gives you the tiniest of breaks by setting thresholds for total payments to 1099 vendors. If you pay a vendor less than the threshold, you don't have to generate a 1099 for him. (For nonemployee compensation, the threshold is currently $600.)

  In the 1099 Summary report window, ...