NONEMPLOYEE COMPENSATION REPORTABLE ON REVIVED FORM 1099-NEC FOR 2020 PAYMENTS
The Internal Revenue Service has revived Form 1099-NEC to eliminate confusion about complying with new filing deadlines aimed at combatting fraud.
Failure to report all non-employee 1099 income on form 1099-NEC for 2020 could land you with many penalties and a non deduction for paid independent contractors making over $600.00 for the year.
“Nonemployee compensation” generally includes payment of $600 or more in fees, commissions, prizes, and awards for services performed as a nonemployee, and other forms of compensation for services performed for a trade or business by an individual who is not an employee. The deadline for filing Form 1099-NEC for the 2020 tax year with both the IRS and the individual workers is February 1, 2021 (since January 31 is a Sunday). However, the deadline for filing the redesigned Form 1099-MISC is March 1, 2021 (since February 28 is a Sunday).