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realtorgrammer
January 10, 2020
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I have a customer that needs to be changed to a Vendor and I need to issue them a 1099. How can I change it?

  • January 10, 2020
  • 3 replies
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Original commenter did not share additional details
Best answer by JaneD

Hi there, realtorgrammer.

 

You'll have to inactivate the customer's name and recreate it as a contractor, so you can issue a 1099 form in QuickBooks Online (QBO).

 

  1. From the Sales menu, choose Customers.
  2. Locate and click on the customer's name.
  3. Click on Edit.
  4. Then, click on the Make inactive button.
  5. Select Yes to confirm the request.

You can now create the customer as a contractor.

 

Let me share this article about how add an independent contractors and track them for 1099s in QuickBooks Online.

 

You can enter transactions and create forms 1099-MISC.

 

We'll be around if you need anything else. Have a wonderful day.

3 replies

JaneD
JaneDAnswer
January 10, 2020

Hi there, realtorgrammer.

 

You'll have to inactivate the customer's name and recreate it as a contractor, so you can issue a 1099 form in QuickBooks Online (QBO).

 

  1. From the Sales menu, choose Customers.
  2. Locate and click on the customer's name.
  3. Click on Edit.
  4. Then, click on the Make inactive button.
  5. Select Yes to confirm the request.

You can now create the customer as a contractor.

 

Let me share this article about how add an independent contractors and track them for 1099s in QuickBooks Online.

 

You can enter transactions and create forms 1099-MISC.

 

We'll be around if you need anything else. Have a wonderful day.

R
realtorgrammerAuthor
January 10, 2020

After I make inactive as a customer and create in contractors, how do I transfer the amounts that were paid for 2019 so i can create the 2019 1099?

thank you.

R
Rasa-LilaM
January 10, 2020

Glad to hear from you again, @realtorgrammer.


Thanks for following the steps provided by my colleague. To transfer the amounts, let’s manually enter them into your account.


Here’s how:

 

  1. Tap the Plus icon at the top and choose any of the following: Check, Expense, or Bill.
  2. This will open another page where you can enter the data.
  3. Enter the correct contractor’s name in the Payee field as well as the Payment account where you want to post the information.
  4. Go to the Category/Item Details section to record the account or item.
  5. Next, type in the amount and other information in the field boxes.
  6. Click Save and New to continue.


You’ll have to select a check or cash to record the payments. If you made any payments to contractors by credit card, debit card, gift card, or a third-party network like PayPal, the IRS requires you to exclude those amounts from your 1099-MISC forms.


For more information about the payments that shouldn't be reported, check out this article. It also contains a link to the IRS instructions for Form 1099-K: Exclude amounts.


If you have any concerns while working in the product, post them below. I’m happy to answer them for you. Have a great rest of the day.  

 

    R
    realtorgrammerAuthor
    January 13, 2020

    Rasa-LilaM

     

    I am getting ready to do the steps above.  Does this mess up my reconciliation reports I have already done?

     

    IamjuViel
    IamjuViel
    January 13, 2020

    Let me share additional information, @realtorgrammer.

     

    Changing the status of your customer to vendor will not affect the reconciliation of your account register.  Only when you update the status of the amount and the posting bank account that the reconciliation report will also be change.

     

    If the amount remain as is, you can mark the amount as reconciled (R) in your account register. 

     

    Feel free to leave a comment below if you have other questions. I'm always here to help.

      K
      KimL2
      January 29, 2021

      I am in the same boat...need to change a customer to a vendor so that I can issue a 1099....but I don't have a "sales" menu in my quickbooks...or at least I am unable to find it.  Tried "jobs" but that didn't work.

      Candice C
      Candice C
      January 29, 2021

      Good afternoon, @KimL2. 

       

      Thanks for joining in on this thread. It's my priority that you're able to change a customer to a vendor so that you can issue a 1099. 

       

      Since you're not able to see the "Sales" tab on the left-hand menu bar when using your QuickBooks Online (QBO) account, are you using a different QuickBooks product? (Example: QuickBooks Desktop) 

       

      If so, here's the correct steps on how to make a customer inactive and to add them as a vendor: 

       

      Make Customer Inactive

       

      1. Go to the Customers menu.

       

       

             2. Select the Customer Center option. 

             3. Right-click on the customer name. 

             4. Press the Edit Customer: Job. 

       

       

             5. Put a check in the box next to Customer is inactive. 

             6. Hit OK. 

       

       

      Add as a Vendor

       

      Note: You may need to change your vendor's name a little so that it won't refer back to the inactive customer. Here's a link that can help out: Change vendor, customer or employee name type. 

      1. Go to the Vendors menu. ​​​​​​
      2. Pick the Vendor Center option. 

       

       

             3. Tap the New Vendor button. 

       

       

             4. Enter all the required information and hit OK when done. 

       

       

      That's all there is to it. Here are a few articles that may be able to help you and your business in the future: 

       

       

      These details should do the trick. Let me know if you have any other questions or concerns. I'll always be around to help. Have a great day! 

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