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Payment to contractor $1,000 (with payment app).
Payment to contractor $2,000 (with credit card).
Is $1,000 or $3,000 the correct amount to report on the 1099-NEC?
(The contractor, a competent bookkeeper, advised the client that $1,000 is the correct amount.)
Instructions: Form 1099-K. Payments made with a credit card or payment card and certain other types of payments, including third-party network transactions, must be reported on Form 1099-K by the payment settlement entity under section 6050W and are not subject to reporting on Form 1099-MISC.
So the instructions say 1099-MISC and don't mention 1099-NEC. If correct, and NEC is intentionally not listed here, then the total payments must be reported.
P.S. These nagging questions remind me to avoid extending my services outside my tax preparation/tax consulting nice.
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Thanks JRC,
New facts:
Client paid $100 by payment app.
Client paid $500 by credit card.
Does the vendor get a 1099-NEC?
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@Strongsilence-CPA wrote:
Client paid $100 by payment app.
Client paid $500 by credit card.
Does the vendor get a 1099-NEC?
No.
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"So the instructions say 1099-MISC and don't mention 1099-NEC."
This is the 1/2022 version:
https://www.irs.gov/instructions/i1099mec#en_US_2022_publink100019786
"Form 1099-K.
Payments made with a credit card or payment card and certain other types of payments, including third-party network transactions, must be reported on Form 1099-K by the payment settlement entity under section 6050W and are not subject to reporting on Form 1099-NEC. See the separate Instructions for Form 1099-K."
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