NEW TAX FORMS 1099-NEC

A new Form 1099- NEC (used for non-employee compensation) has been introuduced by the IRS for 2020. It is actually an old form that hasn't been use since 1982. In 2015, the Protecting Americans from Tax Hikes Act (PATH Act) changed the form 1099-MISC due date to January 31 for reporting compensation. Since some data had a January 31 deadline and other data had a February 28 deadline, some organizations were filing two Forms 1099-MISCS and confusion ensued

The most common examples of payments that must be reported on Form 1099-NEC include:

Payments to independent contractos for services including payments for parts or materals used to performs the services if they were incidental to the services.

Professional services fee paid to attorneys (including law firms established as corporations), accountants, architects,

Revised Form 1099-MISC. The new form 1099-MISC no longer has a box for nonemployee compensation because that data is now reported on Form 1099-NEC.