Understanding and Reviewing Form 1099-NECs
Square’s online payroll service generates, files and mails Form 1099-NEC for each of your contractors at year-end. We will mail Form 1099-NEC(s) to the mailing address provided for each of your contractors. In addition, these forms will be available by going to Payroll > Tax Forms in Square Dashboard. Although we file Form 1099-NEC on your behalf, you and your contractors are responsible for confirming and ensuring the information in the Form 1099-NEC is accurate.
Here are a few things to keep in mind:
Ensure all contractor payments for 2020 are recorded in Square Payroll by January 8, 2020 8:00 p.m. PST. Note: Applicable only to employers who have submitted at least one payroll with a pay date in 2020.
Square Payroll automatically generates and electronically files Form 1099-NECs to the IRS.
Contractors with online accounts can also access a copy of their Form 1099-NEC under their Tax Forms tab or Square Team app. You can also download and distribute the forms yourself.
Square Payroll automatically generates and electronically files Form 1099-NEC to the IRS. For any state participating in the Combined Federal/State Filing (CF/SF) Program, Form 1099-NEC will be forwarded to the state by the IRS, as part of the program. If you are an employer in another state, you’ll need to contact your state revenue department directly about filing the Form 1099-NEC.
Square Payroll does not file Form 1096. Since Square e-files forms 1099-NEC, Form 1096 is not required.
1. Download Your Square Payroll Form 1099-NECs
To access your Form 1099-NECs:
Visit Payroll > Tax Forms in Square Dashboard.
Click the blue link ending in Square_2020_1099.zip to download a .zip file of your Form 1099-NECs.
Extract the Form 1099-NECs from the downloaded .zip file (read below for instructions on doing so on a Mac or Windows computer).
Extract your Form 1099-NEC from a .zip file on a Mac
On most Mac computers, you will find the .zip file containing your Form 1099-NECs in your Downloads folder. To access the file, you can either open the Downloads folder directly or search in your finder for Square_2019_1099.zip. Once you locate the .zip file, double click on it. Your computer will automatically extract the data from the .zip file, creating a folder which contains PDF copies of your Form 1099-NECs.
Extract your Form 1099-NEC from a .zip file on Windows
The steps for extracting your .zip file depend on which version of Windows you are running. To locate the file, search for Square_2020_1099.zip or look for the file in the Downloads folder of My Computer. Follow the links for .zip extraction instructions on Windows 7, Windows 8, and Windows XP.
2. Verify your Square Payroll Form 1099-NEC data
You and your contractors are responsible for ensuring the information on Form 1099-NECs is correct. We’ll start generating draft Form 1099-NECs on January 01, 2021. As soon as these forms are ready, you’ll be able to view them by going to Payroll > Tax Forms in Square Dashboard. Please review them for accuracy. You will have until January 15, 2021 8:00 p.m. PST to review and update your contractors’ full names, SSNs, and home addresses.
Avoid these common errors: Incorrect or misspelled names, incorrect SSN, using nicknames or shortened names, titles before or after the name, and name changes not reported to the Social Security Administration (SSA). Learn more about these critical fields on the SSA website.
3. Distribute Square Payroll Form 1099-NECs
Square Payroll will mail Form 1099-NECs to each of your contractors. Instructions are included with the form.
Note: We will not resend Form(s) 1099-NEC if a contractor does not receive it (due to invalid address or other reasons).
If your contractor has an invalid mailing address and your business has a valid mailing address, their Form 1099-NEC will be returned to your business. You are then responsible for providing them with their copy of their Form 1099-NEC. You can provide your contractor with a printed copy. This can be downloaded from the Payroll > Tax Forms in Square Dashboard.
If your contractor has an invalid mailing address and your business has an invalid mailing address, you are responsible for downloading your Square Payroll Form 1099-NEC and providing them to your contractors.
You can access a copy of your Form 1099- NEC under the Payroll > Tax Forms in Square Dashboard. Form 1099-NECs are not available in the Square Payroll app.
Contractors with online accounts can also access a copy of their Form 1099-NEC under their Tax Forms tab or through the Square Team app.