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A
accounting-thear
June 4, 2022
Question

Omit payment of a vendor expense reimbursement from their 1099

  • June 4, 2022
  • 1 reply
  • 0 views
I have a category for Mileage Reimbursements. How do I omit this payment to a vendor from their 1099?

    1 reply

    L
    LeizylM
    June 4, 2022

    Good day, accounting-thear.

     

    I'd be glad to share some information about excluding payment to a vendor from their 1099 in QuickBooks Online. 

     

    When preparing 1099 forms, IRS requires 1099 filers to exclude any payments you made to a 1099 vendor by credit card, debit card, gift card, or a third-party payment network such as PayPal from Form 1099-MISC. These payments are considered non-reportable payments. These payments are reported by the card issuers and the third-party payment networks on Form 1099-K. 

     

    You can read this article to know when to exclude payments on form 1099: Vendor Payments to Exclude on Form 1099-MISC.

    To clarify things about excluding amounts from 1099, I recommend seeking help from your accountant. He/She could guide you on what to do about your 1099. Or contact the IRS for further discussion on the compliance side of 1099.

    I encourage reading these articles to be guided in preparing tax forms in QuickBooks Online:
     

     

    If you have any other concerns or follow-up questions about 1099, please don't hesitate to visit the Community again. Assistance is just a post away.

    A
    accounting-thearAuthor
    June 6, 2022

    Thank You, LeizyIM.

    Yes, I am aware of which payments to exclude from a vendor’s 1099. 

    My question pertains to how to input the expense into Quickbooks online without it being recorded by Quickbooks on the vendor’s 1099. When I record the reimbursement as an expense that is payable to the vendor, Quickbooks lists it as part of their 1099. This would seem to be an issue for any of the items you listed as well. Even if you make a vendor payment by PayPal, it will still need to be recorded as an expense in Quickbooks to keep my account balance accurate, but Quickbooks is still adding any type of payment to a vendor to their 1099 balance. How to I make it so Quickbooks will not add these excluded expense payments to the vendor’s 1099 total?

     Thank you. 

      M
      Mich_S
      June 6, 2022

      Thank you for providing us with further information about your initial queries, @accounting-thear.

       

      I'd like to add some more information about removing an expense from 1099 forms.

       

      If you don't want the expense/account to appear on the form, make sure it's excluded from the 1099 mapping.

       

      I'll show you how you can do it:

       

      1. Open the Payroll menu from the left pane.
      2. Select Contractors/Vendors.
      3. Click on Prepare 1099's.
      4. From the Accounts section, unselect the expense account you don't want to show.
      5. Once done, click on Next or Save and finish later.

       

      For reference, see these photos:

       

       

       

      In addition, I'd also suggest consulting your accountant. This way, you can verify if it's advisable to exclude those amounts.
       

      You can also check out these helpful articles about handling 1099's in QuickBooks Online:

       

       

      Keep us updated by leaving a reply to this thread. I'm more than happy to assist if you have other concerns with 1099 or QuickBooks in general. Keep safe and have a great week ahead!

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