I own a rental property and used an agent to manage the condo rental for me. I paid him with management fees, so need to issue the 1099-NEC form for tax purposes.
How can I file the 1099-NEC with the IRS? Does Turbotax software offer this feature, and if so, which version includes it?
Initially, I considered utilizing the IRIS Taxpayer Portal to apply for a Transmitter Control Code (TCC). However, it appears that system is designed for businesses as it requires an Employer Identification Number (EIN). As an individual taxpayer, I do not have the EIN.
Yes you need either the Desktop Home & Business program or the Online Premium version. You can upgrade to Home & Business from inside your Premier program. I would stick with the Desktop program. It has more features than the Online version.
You can do them 2 different ways from the Windows Desktop Home & Business program. Either Online using Quick Employer Forms (QEF) -or- directly on your computer with the built in W2/1099 Reporter. If you use the Reporter on your computer you have to mail them to the IRS and not efile.
In the Window's Home & Business Desktop program to Prepare W2s or 1099s, on the first main screen there are 3 ways to start. Either click on the blue button Start a New Return or click on Create 1099/W-2 or go up to File-New Tax Return.
What version do you have? If you have the Desktop Home & Business program
How to prepare 1099Misc & W2
https://ttlc.intuit.com/community/forms/help/how-do-i-create-w-2-and-1099-forms-in-turbotax/00/25869
You can prepare W2 and 1099NEC & 1099MISC in either the Desktop Home & Business program or the Online Premium version.
For Online Premium:
Sign in to TurboTax.
Select Tax Home from the left menu (you might already be there).
Scroll down and select Your account.
Select Create W-2s and 1099s.
This will log you in to Quick Employer Forms.
Follow the instructions to create forms online for your employees or contractors.
I am using Turbotax Premier desktop version and I can not find the function to create the 1099 form.
Do I have to switch to "Desktop Home & Business program" or "Online Premium" version?
Thank you.
Yes you need either the Desktop Home & Business program or the Online Premium version. You can upgrade to Home & Business from inside your Premier program. I would stick with the Desktop program. It has more features than the Online version.
You can do them 2 different ways from the Windows Desktop Home & Business program. Either Online using Quick Employer Forms (QEF) -or- directly on your computer with the built in W2/1099 Reporter. If you use the Reporter on your computer you have to mail them to the IRS and not efile.
In the Window's Home & Business Desktop program to Prepare W2s or 1099s, on the first main screen there are 3 ways to start. Either click on the blue button Start a New Return or click on Create 1099/W-2 or go up to File-New Tax Return.
As an individual filing the rental on the Sch E on the personal income tax return you do NOT need to issue a 1099 to the property manager ... instead he should be issuing you a 1099 for the rent he collected on your behalf along with a report of all the income and expenses paid out on your behalf ... their fees would be on that report. Please talk to them before doing something that is not needed.
I'd like to provide more clarity to ensure I'm following the correct procedures:
The 'Property Manager' in question isn't a business entity but an individual. He handles tenant communication and other rental-related issues. However, the tenant pays the monthly rent directly to me, after which I compensate this individual (property management agent) with a percentage of the monthly rent as a management fee. Consequently, this individual won't provide me with a 1099-MISC form.
Could you please advise if issuing the 1099-NEC form is necessary for this individual?
Thank you.
Ok... so he is not a traditional mgmt company who does everything and sends you a 1099 ... then back to the basics. Unless your rental has risen to the level of being a business you do not need to issue a 1099 since you will not have an EIN as a business. You should keep good records of the payments like cancelled checks or CC statements, receipts he may give you and continue to report the rental on the Sch E.
"I still disagree with you. Even though I only rented out one small condo, as far as I understand, 'Landlords are required to send out 1099s when paying $600 or more to certain individuals and businesses.'
Therefore, I believe I still need to issue the 1099-NEC since I paid this individual more than $600 per year.
Please let me know if I'm mistaken."
See 1099NEC instructions on page 8 - Exceptions, 3rd point
1099 Instructions page 8 - Exceptions, 3rd point: "Payments of rent to real estate agents or property managers."
That is correct, tenants will not issue the 1099 for the rent they paid to the real estate agents or property managers.
However, I believe I still need to issue the 1099-NEC to the individual agent since this is the agent service fee, not the rent.
Correct me if I am wrong.
First if your rental doesn't rise to the level of a business the 1099 does NOT need to be issued however there is no rule that says you cannot issue one if you really want to ... so go ahead, get an EIN and waste time, ink and paper filing a form that is not necessary.
If I use Turbotax Windows Desktop Home & Business program to issue 1099, does it require EIN ?
Thanks.
No. You can use your ssn. I do. I have Windows Home & Business program. I worked out the steps.
You can do them 2 different ways from the Windows Desktop Home & Business program. Either Online using Quick Employer Forms (QEF) -or- directly on your computer with the built in W2/1099 Reporter. If you use the Reporter on your computer you have to mail them to the IRS and not efile.
In the Window's Home & Business Desktop program to Prepare W2s or 1099s, on the first main screen there are 3 ways to start. Either click on the blue button Start a New Return or click on Create 1099/W-2 or go up to File-New Tax Return.
Or if you are already in a tax return in the upper right there is Employer Forms Create Forms link. Or if you are in the Business tab you can get to the Online Quick Employer Forms under Business Expenses - Other Common Expenses - Contract Labor, click the Start here link.
If you click on the blue Create 1099/W-2 button you will get a box to Create employer forms using Quick Employer Forms OR you can pick Create forms on Desktop at the bottom.
If you click on Start a New Return you will get 2 choices, Check the second circle that says Prepare W-2s and 1099s for my employees or contractors. Then that will expand and give you a choice to prepare them Online (Recommended) or On My Computer.
If you go up to File-New Tax return you will get 2 choices, 2023 US Form 1040 -or-
2023 US Forms W-2/1099 Reporter. Pick the second one. But this will only give you the Desktop Reporter version and not file them online. You will have to print and mail to the IRS.
If you paid more than $600 to a non-employee or an entity that is not a S-Corp or C-Corp then you will need to file a 1099-NEC with the IRS and potentially with your state. I own rental property and now file 1099-NEC's for plumbers, tree trimmers, handymen, etc. Instead of paying for the Home and Business version of TT, I fill out the forms directly from the IRS: https://www.irs.gov/pub/irs-pdf/f1099nec.pdf
You can file the 1099-NEC by mail or electronically outside of TT.
I'd love to give this a try as well. Could you walk me through the process, please?
1. Do you need to fill this form with Red Colour ink?
2. You print out this form with Red Colour and mail it to IRA?
3. How to file this form to IRA electronically outside of TT?
Thanks.
I looked at this link before and that why I asked Occams Razor
1 -- This form can not be printed from the website, the only option will be to order it from the IRS?
2 -- File it electronically outside of TT seems impossible unless having the Employer Identification Number or through third-party software.
Thanks.
1. Do you need to fill this form with Red Colour ink? Do not fill out with red ink because it may not be scannable. Only use black ink. Also do not fill out the first form that is in the light pinkish orange color. Here are the instructions for the form: https://www.irs.gov/instructions/i1099mec
2. You print out this form with Red Colour and mail it to IRA? I fill the PDF version directly on my computer and then print in black ink. There are 4 printable forms. Copy C goes to the IRS and Copy 1 goes to your state if required. Copy B and Copy 2 are mailed to the recipient (the person you paid). You should also send them the instructions for Recipient.
3. How to file this form to IRA electronically outside of TT? I've been mailing my 1099-NEC's to the IRS for the last couple of years. This year I will probably send electronically. Here is the site for e-filing through the Information Returns Intake System (IRIS): https://www.irs.gov/filing/e-file-information-returns
Randy
Thanks, but I still have questions regarding the third point:
1 -- Where did you get the "Copay A" form that you mailed to the IRS (because the IRS stated "Do not print and file "Copy A" form)?
2 --The "Copy A" you mailed to the IRS in Red ink or black ink?
3 -- If you want to e-file through the IRIS, you must have (EIN) Employer Identification Number, do you have the EIN?
Thanks.
You can buy the red forms at office stores like Staples or on Amazon or Walmart.
Where is COPY A of my Forms 1099 and W-2?
Quick Employer Forms only supports e-filing of the forms with the IRS and Social Security Administration. Copy A of the Form 1099 and W-2 are only used for e-filing and are not provided for printing. But if you don't use Quick Employer Forms you need to mail it.
1 -- I see why I caused you confusion. For the last couple of years, I was filing late in January so I was sending the IRS my Copy C because I didn't have time to order the official Copy A. The IRS states that you must file a red Copy A form by mail but I've read that they will accept black ink forms. However, the IRS also state that they will penalize you if you don't use the official red Copy A form. So far the IRS has not sent me any communication or penalized me on my Copy C forms and it's been almost a year since the last one. However, there is still risk involved so if you want to play it safe, you can try VolvoGirl's suggestion above.
You can also try to order the forms through this website: https://www.irs.gov/businesses/online-ordering-for-information-returns-and-employer-returns
2 --The "Copy A" you mailed to the IRS in Red ink or black ink? The forms should be filled out in black ink. Red ink is not scannable and I believe the red form itself is not scannable so an IRS program can just read the tax content of the form.
3 -- If you want to e-file through the IRIS, you must have (EIN) Employer Identification Number, do you have the EIN? No I do not. I haven't used IRIS before so I assumed they would use your TIN. I believe you can apply for an EIN through the IRS so I'll have to look into that. Since I will have my rental properties for awhile, I will probably apply for one. Sounds like paying for the the Turbo Tax upgrade may be an easier path for filing 1099's.
Good luck.
Yes, I would suggest using IRS Quick Employer Forms by upgrading your product just for your own peace of mind knowing that Turbo Tax will file correctly with the IRS. Let turbo Tax assume the responsibility on filing these properly with the correct color ink.
No red ink forms are needed when the forms are efiled. Always use the Quick Employers Forms tool ... it is free and simple.
Many thanks for your helpful answer and link ! I really appreciate not having to upgrade TT for one form - you saved me $$$ and aggravation. Unfortunately my Adobe Reader will not to allow me to fill out the form, but hopefully the IRS can handle my hand written content. My typewriter is long deceased at this point! Happy and Healthy New Year!
FILE FREE HERE : https://www.irs.gov/filing/e-file-forms-1099-with-iris