1099 NEC and S Corp

[isambucop]

I received a 1099 NEC to my S Corp EIN.  I've already filed taxes for my S Corp. Do I need to report my 1099 NEC on my personal taxes.?  (My S Corp paid me as an employee for 2020 and I've received a W-2 for those payments.)

[MinhT1]

If you received a 1099-NEC in the name of your S-Corp and you have not included that amount of income in your S-Corp tax return (form 1120S), then you must file an amended return for your S-Corp to include that income.

The S-Corp will then provide you with an amended schedule K-1 which you will use to amend your personal tax return.

[Rick19744]

How many shareholder's does the S corp have?

[isambucop]

Just myself..and I'm the only employee.

[DanielV01]

You don't want to report the 1099-NEC on your personal return.  Doing so will subject the amount to Self-Employment taxes, which your reportable share of S-Corporation income is not subject to Self-Employment taxes.  Another question would be if the amount recorded on the 1099-NEC is already included in your S-Corp income.  If that is the case, then just hold on to the form, and be ready to show the IRS that the income reported to you has, in fact, already been included in your 1120-S. 

If the amount reported on the 1099 has not been included in your S-Corp's original return, you would then need to amend (or supersede) your 1120-S to include the income (which will create an amended K-1, which would create a change to your personal return.  If your personal return is already filed, then you would need to amend that also).  But it most definitely is not income you want to include on your personal return.

[ArebaAccounting]

Hello, I have the same problem. I got 2 1099-NECs as a single member LLC taxed as an S Corp. I've included that income under sales and service receipts, it's about 40% of my gross revenue. There's no way to enter more data in turbo tax about it? When I get a personal 1099 I put the payer's information & TIN to show the IRS I'm acknowledging it. Won't the IRS be curious why two 1099s are going unreported by the payee? I just don't want to get audited my first year in business. I know you've already answered this I just want to clarify this won't be a giant flashing red light on my 1120-S, thanks!

[DianeW777]

There is no need for concern. If you have included your income on your tax return from the Forms 1099-NEC then you have included the correct gross receipts.  If you are saying the document was issued in the EIN of the SCorp instead of your social security number or vice versa you can nominee the amount to the correct taxpayer identification number (TIN) so that the IRS knows where to look for the income.

Nominee returns. 

Generally, if you receive a Form 1099 for amounts that actually belong to another person or entity, you are considered a nominee recipient. You must file a Form 1099 with the IRS (the same type of Form 1099 you received).  You must also furnish a Form 1099 to each of the other owners. 

File the new Form 1099 with Form 1096 (this is a transmittal for the 1099) by mailing to the Internal Revenue Service Center for your area. (Provided on the Form 1096)

• On each new Form 1099, list yourself as the payer and the other owner, as the recipient. On Form 1096, list yourself as the nominee filer, not the original payer.  The nominee is responsible for filing the subsequent Forms 1099 to show the amount allocable to each owner. 

If you choose this one here is the TurboTax program for creating 1099s.

The forms filed with the IRS should be the red copy so if you don't have a color printer, go to the IRS website and order the forms here: 

• Form 1096-Transmittal
• Form 1099-NEC 2021

[Sam Hopi]

Hi, My S--Corp issued a 1099-NEC  for a independent contractor what line should I enter on 1120-S?

Thanks in advance!

[Rick19744]

@Sam Hopi 

You don't indicate what type of business the S corporation operates.

I recommend you put it on a line that it relates to:

• If you use the CGS line (form 1125-A), and the labor relates to that, put it on line 3 or 5 of that form
• If you don't use CGS, just put it on the other deductions line and label it appropriately.

[MANI1346]

Thanks@Rick

It is not related to CGS. It is a service business. I think it goes on line salary and wages line 8, am I right? 

[Mike9241]

No. salary and wage line is for compensation paid to employees which means the line is for W-2s. 

what other line best describes what you paid them for? if none use line  19 and a description such as legal fees. 

[raj27]

I am stuck at the same step: My S Corp issued a 1099-NEC to Corp X and reported that dollar amount in the S Corp tax returns under the Payments to Independent Contractors section, but it did not ask for any details about Corp X. Is that common?

[PatriciaV]

Since you filed Form 1099-NEC, the IRS has the information on the contractor you paid. All you enter on your S-Corp return is the related expense amount.

@raj27

[raj27]

Thank you!