How to Set up 1099 Employees in QuickBooks Online

1099 Employees are referred to as self-employed individualistic contractors. The salary depends upon their contract terms and a 1099 form to monitor the total income with the tax return. 1099 employees are an example of contractors. These employees control their work with their tools. According to Intuit Full Service Payroll, contract 1099 forms are generated. Learn how to set up 1099 employees in QuickBooks Online

The majority of small organizations hire independent employees for a short term to complete specific projects.  Entire expenses linked with their work are analytic. One can monitor these expenses & E-file 1099-MISCs directly from the QuickBooks software.

How to set up an Employee for 1099 in QuickBooks online?

The list of steps to set up the employees for 1099:

• Navigate to Employees located in the left menu bar & perform a double click to open an edit window
• Discover Edit is positioned at the top of the screen & enter the Employee tax ID number listed in Tax ID &
• Select the box written under Track payments for 1099
• Hit on the Save button
• The next step is performing the Mapping of the 1099 to Accounts:
• Locate Employee present in the left menu bar; discover Prepare 1099s located at the upper top of the screen. After that, proceed with 1099s if you have already initiated setting
• If you have an earlier finished setup process, the details like the organization name and ID number, disappear in this section.
• Hit on Next and select the box that represents the type of compensation types
• Select choose an account on a drop-down
• Proceed with clicking on the Next option
• Hit on the Next option
• Now Hooray screen appears on the screen and selects 1099 E-file Service to permit for a fee, or you can also hit on Print & mail forms
• Read the instructions written on the form & print it. Verify the form to check the alignment.
• There are also troubleshooting tips written under the step.

Related Topic: Resolve QuickBooks 1099 Form File Error

How to set up an expense Account to monitor a 1099 employee’s expenses?

The need for an expense account is mandatory for the contractor’s payments. This process is especially significant for Employees to purchase products & services.

Following is the list of steps:

• Locate the Accounting Tab and then select Chart of Accounts. Now create an account that is given below
• Give a name as Independent Contractor Labor that is easy to identify
• Sort out expense on the dropdown button named Account type & cost of labor on the drop-down option Detail type
• Hit the Save & Close button
• Now, whenever you enter an expense amount on an independent contractor. The next step is to link that transaction to the newly created expense amount.