Trade sales and Contest Winners, how to enter to generate 1099's

Recording this type of transaction can be tricky, @RadioRocks, but I'm here to help you navigate it accurately in QuickBooks Enterprise.

To begin with, please set up a vendor profile for each contest winner and mark them as Vendor eligible for 1099. This way, we can issue a 1099.

Here's how:

1. Go to the Vendors menu and select Vendor Center.
2. ClickNew or choose a vendor’s name and click Edit✎.
   
3. Navigate to the Address Info tab and double-check the information:
   • Ensure you have the correct two-letter state abbreviation and ZIP code.
   • If the vendor is an individual, their legal name should be filled in the First Name, M.I., and Last Name fields.
   • If you have the company name but not the specific person’s name, leave the Company Name field blank to avoid duplicate entries when preparing 1099-MISCs.
4. Next, head to the Tax Settings tab.
5. Check the box for Vendor eligible for 1099.
   
6. Enter the vendor's tax identification number in the Vendor Tax ID field.
7. Click OK.

We'll also set up your client as vendor and customer. To avoid confusion, you can make one of the names slightly different. After that, let's create a dedicated barter account and item as a placeholder for the items you've received. 

To record the transactions, you’d enter a sales receipt and a check to record the products or services you’re exchanging. 

Entering sales receipt:

1. Go to the Customers menu.
2. Choose Enter Sales Receipts.
3. From the Customer: Job drop-down, select a customer.
4. Set the barter account as the deposit account.
5. Fill in the relevant information at the top of the form like the Date and Sale No.
6. In the detail area, select the services you propose to do or include as a sale.
7. Enter the other necessary information, then hit Save & Close.

Entering a check:

1. Go to the Banking menu.
   
2. Choose Write Checks.
   
3. From the Customer: Job drop-down, select your barter partner.
4. Set the barter account as the payment account.
5. In the Items tab, select the goods you've received.
6. Enter the other necessary information, then hit Save & Close.

 
Once done, simply issue another check or create a bill and bill payment to the contest winner to log the prizes they've won.

 When you're all set up and ready, follow these steps to map your expense account to the correct 1099 box. 

1. Click Vendors, choose 1099, then click Yes to proceed. 
2. Select either Form 1099-NEC or Form 1099-MISC. 
3. In my example, I've selected Form 1099-NEC. 
4. Tick the box for each of the Contest Winner, then click Continue. 
   
   
5. Review the contest winner information, then click Continue. 
6. Map the vendor payments account. 
7. In my example, I've selected NEC box 1: Nonemployee Compensation.  
   
8. Continue the rest of the onscreen steps. 

 
If you still further guidance in performing the procedures, I highly recommend consulting with an accountant or a QuickBooks Professional Advisor to ensure they are accurately recorded and reported.

Additionally, you might want to check out these articles to learn how to generate a 1099 report and make corrections to 1099-NEC or 1099-MISC forms: 

• Create 1099 reports in QuickBooks
• Correct or change 1099s in QuickBooks 

If you encounter any challenges or have further questions as you work on this, please don't hesitate to reach out. The Community team is always available to assist you every step of the way, @RadioRocks.