3 Things to Know About Form 1099-NEC

Written by

What is Form 1099-NEC (Nonemployee Compensation)?

The IRS is bringing back a form last used in 1982s —Form 1099-NEC, to be used beginning with 2020 information returns. The draft 2020 version of the form has been posted by the IRS to the agency’s website. Part of the rationale for the new Form 1099–NEC was that the Protecting Americans from Tax Hikes (PATH) Act of 2015.

It will be used to report at least $600 payments made to each person during the calendar year for your business:

  • Services performed by someone that was not your employee
    • Include parts/materials used to perform the service
  • Cash payments for fish (or other aquatic life) you purchase from anyone engaged in the trade or business of catching fish
  • Payments to attorneys

Withheld any federal income tax under the backup withholding rules regardless of the payment amount.

Common examples of who will receive Form 1099-NEC:

  • Attorneys
  • Architects
  • Accountants
  • Graphic Designers
  • Web Developer
  • IT Consultants
  • Freelance writer
  • Non-employee Sales Commission
  • Freelance Contractors
  • Landscapers
  • Other self-employed individuals

Form 1099-NEC:

Due to IRS & Recipient 2/1/21

  • A IRS
  • 1 State Tax Department
  • B Recipient
  • 2 Recipient copy to be filed with state income tax return (if applicable)
  • C Payer

Form 1099-MISC:

Due to recipient by 2/1/21 or 2/16/21 if reporting in box 8 or 10. Due to IRS by 3/1/21 (paper) or 3/31/21 (electronic)

  • A IRS
  • 1 State Tax Department
  • B Recipient
  • 2 Recipient copy to be filed with state income tax return (if applicable)
  • C Payer

Ready to start your new year with organized financials in preparation for tax season? Plumb Family CFO works in partnership with your CPA and personal financial team.  Fill out the form below to find out more.

Landing Page Contact Form

Related Posts:

Know Your Net Worth: Personal Bookkeeping & Bill Paying Services

Written by

Personal bookkeeping & bill paying services help keep your financial life on track.

Do you know your net worth?

It is a simple math equation. Your net worth equals your assets minus your liabilities.

For those with a complex financial life, it can be a challenge to determine this calculation. You must first assign values to all your assets, including investments, brokerage accounts, personal property such as real estate, vehicles, jewelry, etc.  You also need to accurately track your expenses and debt, including loans, bills, taxes due, etc.

When someone’s wealth accumulates to a certain level, many individuals and families turn to a personal bookkeeping service or setup a single family office to help with the day-to-day financial tasks of tracking income/expenses, paying bills and creating consolidated financial reports.

How Can a Personal Bookkeeping Service Help?

Here at Plumb Family CFO, we understand the unique needs of the high-net-worth.  We have been helping affluent families, busy entrepreneurs and retired couples navigate their personal finances by providing a high-level bookkeeping service that is trusted and dependable.

We become your back-office accounting team. Our accounting experts have both corporate and personal bookkeeping backgrounds and deliver white-glove customer service.  By outsourcing bookkeeping to Plumb Family CFO, you will receive a team of accountants to provide services including:

  • Monthly consolidated financial statements to determine your net worth
  • Cash flow reports to track your income and expenses
  • Budget analysis to create a personal budget based on spending habits and long-term goals
  • Bank & credit card reconciliations
  • Entity bookkeeping for sole proprietorships, partnerships or corporations if necessary
  • Payroll administration for your household employees
  • Trust and foundation accounting
  • Bill payment services, including wire transfers, vendor management and capital calls

The setup process is unique for each family.  Personal bookkeeping services are customizable and pricing is based on a monthly fixed-fee basis.  The back-office accounting means that we can work virtually for the majority of the bookkeeping transactions, but also have meetings in person or on the phone to review financial statements and goals.

At Plumb Family CFO, we believe that by knowing your net-worth you can take true control of your wealth. 

What are the benefits of hiring a personal bookkeeper?

  • Reduce your stress and anxiety from managing multiple bills and due dates
  • Get a clear picture of your net-worth to make better decisions regarding your wealth
  • Gain access to a view of your monthly expenses, due dates and income from all your entities, etc
  • Have more time to focus on your family, your business and free time
  • Add the missing piece to your team of trusted advisors 

Want to learn more?  Please contact us for a no-obligation phone call to learn more about our process, pricing and personal bookkeeping services offered.

Landing Page Contact Form