Creating late W2, converting from 1099

[anuj1212]

We are a bootstrapped startup with 1 employee, who started out as someone consulting for us informally last May. We thought of him as an independent contractor whose role evolved more to that of an employee. We are now wondering if instead of treating him as a freelancer, if we can issue a W-2 for 2019 for him instead and what would that process be?

And can this be done on TurboTax?

[Irene2805]

No - This cannot be done retroactively,.  There are a lot of things to consider when switching the status of a worker from independent contractor to employee.  Please see these articles

• Understanding Employee vs. Contractor Designation
• Independent Contractor (Self-Employed) or Employee?
• How to Convert a Worker from Contractor to Employee

You can use Quick Employer Forms (accessed through Turboax) to prepare 1099 (or W-2) forms for your workers.

To create 2019 1099-MISC forms you need to use the 2019 version of either TurboTax Self-Employed (online) or TurboTax Home & Business or TurboTax Business (CD/Download).  See the directions below.

TurboTax Self-Employed [Online]

1. Click on Income and Expenses and then click the Start/Revisit box in the Self-Employment section.
2. On the Your 2019 self-employed work summary screen, click on Edit next to your business. 
3. On the Here's your [business] info screen, click on the box Add expenses for this work. 
4. On the Tell us about any expenses screen, scroll down to Less Common Expenses, mark the radio button for Contract Labor and click Continue at the bottom of the screen.
5. On the screen, Let's enter the contract labor expenses for your [business], click on the link Help me prepare and file W-2s and 1099s.  Then click on the link in the Search box.
6. This will take you to the Quick Employer Forms website, where you can prepare your forms.

TurboTax Home & Business [CD/Download]

Note: If you already have a tax return open, choose New Tax Return from the TurboTax File menu. Click Yes to save the return you currently have open.

1. On the home screen, Continue Your 2019 Tax Return screen, click the blue Start a New Return button.
2. On the next screen, What would you like to do? mark the radio button next to Prepare W-2s and 1099s for my employees or contractors and click Continue
3. Follow the on-screen instructions.