1099s

[Dennisthayer]

I have a very small business, with a crew of workers who are paid as independent contractors, formerly requiring issuance of 1099s when their annual pay exceeded $600, and paid via Venmo and Zelle. My question is, as I understand that those services are now required by IRS to issue 1099s, do I still have to issue a 1099 also? Thank you for your help!

[KarenL4]

Hi, you would NOT report the compensation on both 1099-K and 1099-NEC. If it is appropriate to report it on the 1099-K, please use that.  Here's an excerpt from a great CPA Advisor article that addresses this exact topic.

" The IRS has directed that any 1099-NEC or 1099-MISC payments that are reported on a 1099-K should be reported on the latter form only. To avoid double taxation, keep detailed sales records and watch for duplicate payments. Businesses must provide a 1099-NEC for non-employee compensation of $600 or more. Payments made with a credit card must be reported on Form 1099-K, not Form 1099-NEC, but if the transactions occurred through credit card or third-party processors, there is a possibility of them being reported incorrectly on both forms."

Please cheer if you find this response helpful. 🙂