How to enter Form 1099-NEC, Nonemployee Compensation in ProSeries

This article will help you enter income and withholding from Form 1099-NEC in ProSeries.

For tax year 2025 the IRS did not have specified mandated reporting requirements on how to report Qualified Tips and Overtime on the 1099-NEC. These may need to be manually calculated. See guidance here.

To access the Form 1099-NEC Worksheet:

1. Press F6 to bring up Open Forms.
2. Type 99N on your keyboard to highlight the 1099-NEC Wks.
3. Select OK.
4. In Create New Copy enter the Payer name from the 1099-NEC.
5. Select Create.

How do I link a 1099-NEC Worksheet to another Schedule?

1. Open a 1099-NEC Nonemployee Compensation Worksheet.
2. In the Double click to link to: field double click.
3. In the Select Schedule screen select an existing Schedule or create a new Schedule.
4. Select the Link button.

Entering Qualified Tips and Overtime for the Schedule 1-A for tax year 2025

To enter an amount to show on Schedule 1-A line 5 as qualified tips from 1099-NEC:

When the qualified tips are from a 1099-NEC they will only flow to the Schedule 1-A if the 1099-NEC is linked to a Schedule C.

1. Open the 1099-NEC Worksheet.
2. In Box 1 enter the amounts from the 1099-NEC received.
3. In the Double click to link to Schedule C box double click and select the applicable Schedule C.
4. Scroll down on the 1099-NEC Worksheet to the Qualified Tips Worksheet for Schedule C.
5. Enter the amount as Qualified tips included in Box 1.
   • Only the amount greater than the amount of income will show on Schedule 1-A line 5.
6. Select the best description for the occupation.
7. Answer Yes or No for the uncommon situations.
8. Go to the Schedule C.
9. Review the Qualified Tips Smart Worksheet for Schedule 1-A, Part II to review the amounts flowing to the Schedule 1-A.

To enter the amount of overtime on a 1099-NEC for the Schedule 1-A line 14b:

ProSeries does not automatically calculate the amount of the deduction from a 1099-NEC or 1099-Misc. If there is qualified overtime on the 1099-NEC or 1099-MISC the deductible portion will need to be manually calculated and entered on the Schedule 1-A line 14b.

How to Create Form 1099-NEC in Quick Employer Forms

1. Log into the Quick Employer Forms Home.
   • Note: If you're unable to log in, make sure you're also signed into ProConnect Tax.
2. Find the relevant business, and select Create Form.
3. Select or create the Payee for whom the form is for.
4. Under Form Type, select 1099 - NEC.
5. Enter the following:
   • Payer information (your business)
   • Payment information
   • (If Applicable) Federal Income Tax Withheld (Box 4).
   • (If Applicable) State Information (Boxes 5-7).
6. Save, Print, and/or E-File the Form.

How do I get the nonemployee compensation to flow as wages?

If you choose to report nonemployee compensation as wages on the 1040 the 8919 is required. For each firm listed on Form 8919, or each Form 1099-NEC with an entry in box 7 that is reported on Form 8919, a reason code must be entered. This code identifies the reason for filing Form 8919. The valid codes are:

• A - The person has filed Form SS-8 and received a determination letter stating that I am an employee of this firm. The date of the letter must be entered as the 'determination' date.
• C - The person has received other correspondence from the IRS that states that the person is an employee of the firm or payer of the Form 1099-NEC. The date of the letter must be entered as the 'determination' date.
• G - The person has filed a Form SS-8 with the IRS and has not received a reply.
• H - The person received a Form W-2 and a Form 1099-NEC from this firm this year.  The amount on Form 1099-MISC should have been included as wages on Form W-2. (Do not file Form SS-8 if you select code H.)

For entering Nonemployee compensation in tax year 2019 and prior see Entering information from Form 1099-Misc

If you're looking for how to create a Form 1099-NEC to issue, see here for how to use Quick Employer Forms to do so.