Compensation of $600 USD or more within a calendar/tax year that is paid to non-employees who file taxes in the United States must be reported to the Internal Revenue Service (IRS).
TABLE OF CONTENTS
- Does Worksuite file 1099s for our freelancers?
- What are the stages of the process and on what timeline?
- If the freelancer has completed a W-9 in their Worksuite profile, do they still need to enter/update the Tax Information section of their profile?
- How much does 1099 filing cost?
- What type of 1099 filing do you submit?
- Who is the Payer on the 1099 filing?
- Which payments are included in 1099 filings?
- We've stopped working with the freelancer. Will you still file their 1099?
- External Payments: Can you file a 1099 for payments made to freelancers outside of Worksuite?
- When are 1099s filed?
- How are 1099s filed?
- How do our freelancers receive a copy?
- Do we receive a copy?
- How can we contact you for additional information?
Does Worksuite file 1099s for our freelancers?
Yes, for Global Pay customers who opt in to our annual filing service. In early November each year, we invite your Finance/Tax contact to an onboarding workflow to guide them through each stage of the process, to include indicating your company's participation.
What are the stages of the process and on what timeline?
Once your company is opted in:
In mid-November, we request your freelancers to review and update as needed the Tax Information in their Worksuite profile.
In early December and mid- to late December, we send an additional reminder and a final notice.
In January, we aggregate the filing data and prepare a preview file for your review and approval, addressing any gaps or discrepancies as needed.
No later than January 31, we generate the final data set and complete the filings to the IRS in bulk.
Through April 15 (and likely beyond), we support you and your freelancers with any corrected filings that may be required.
If the freelancer has completed a W-9 in their Worksuite profile, do they still need to enter/update the Tax Information section of their profile?
Yes! We source the filing information from data fields in their Tax Information rather than parsing PDF documents.
***Important Note: In April 2023, it will become a requirement for all contractors -- not only those who file taxes in the United States -- to complete Tax Information in their Worksuite profile in order for us to process their payments. Each country has unique income and tax reporting requirements that you must abide by for all payments to contractors. We collect this information to facilitate your company’s, and that of Worksuite as your payment processor, adherence to these requirements.***
How much does 1099 filing cost?
For tax year 2022, the initial filing is free of charge!
While we work with you and your freelancers to collect a complete and accurate set of filing data, some corrections are inevitable, at the cost of $20.00 USD per filing. Corrections include new filings after the deadline when tax filing information is newly received.
What type of 1099 filing do you submit?
We file Form 1099-NEC for all payments.
Who is the Payer on the 1099 filing?
During the opt-in workflow, you will have a chance to either review or add your company's tax information as you will be the Payer on the 1099.
[An exception would be if you are leveraging our EOR and AOR Services. For more info on this, see here and/or reach out to firstname.lastname@example.org.]
Which payments are included in 1099 filings?
We file for the following payments:
Earned by freelancers who file taxes in the United States (note that the freelancer may reside abroad)
Invoices are in the Processing status by December 31, 2022
The sum of the freelancers’ invoices is $600 USD or more
At this time, we do not exclude 1099 filings based on the Federal Tax Classification indicated in the freelancer's Tax Information.
Our 1099-NEC issuance for payments to a C- or S-Corp can serve as a reference for compensation and may be disregarded for IRS purposes.
Beginning with the 2023 tax year, we will only file 1099s for:
- Individual / Sole Proprietor
- Single-member LLC
- LLC Partnership
We want to exclude expense reimbursements from the total compensation filed.
We can do this for you! Please ensure you are making use of the Line Items feature in your Worksuite invoices. As long as Expense line items have been accurately categorized, we can enable an optional feature in your environment to exclude these expenses from 1099 filing.
Please see more detailed information here.
We've stopped working with the freelancer. Will you still file their 1099?
If you have archived a freelancer profile, this will not prevent Worksuite from filing their 1099 if they meet the criteria above.
Note that they will be unable to access Worksuite to review/update their Tax Information. They may reach out to us to report an access issue, in which case we will redirect them to you for guidance.
You may temporarily unarchive their profile so they may review their data, or you may choose to review and confirm the data with them on their behalf.
External Payments: Can you file a 1099 for payments made to freelancers outside of Worksuite?
By default, Worksuite invoices for which you processed the associated payments off-platform are included in our filings.
To file for payments made externally and not represented by a Worksuite invoice, the onboarding workflow will allow you to:
- Indicate that you have external payments to be filed
- Access a spreadsheet template in which you may complete the freelancer's tax filing data and the compensation amount to be filed
- Upload the completed template
We will review the file and reach out if any questions regarding the external data.
When are 1099s filed?
No later than January 31 of each year for the previous tax year.
How are 1099s filed?
We e-file with the IRS through our third-party partner, Tax1099.com.
How do our freelancers receive a copy?
At the time of filing, an email is sent from Tax1099.com to the freelancer's email address associated with their Worksuite profile containing instructions to access and download their electronic copy.
Do we receive a copy?
After filings are completed, we will upload to your customer profile in Worksuite a bulk PDF of all filed copies so you may support your freelancers with requests for new copies. Please anticipate this to occur no later than the first week of February.
How can we contact you for additional information?
Please email the Worksuite Payments team at email@example.com, and we’ll be happy to assist you.
(Freelancers may reach us via the Support button on any page of Worksuite or submitting a support request from our Help Center.)