How to create and file 1099s in QuickBooks Online
Here’s how to create and file 1099s in QuickBooks Online. These are the standard QBO steps.
1. Confirm your company and tax settings
In QuickBooks Online, go to:
Settings ⚙️ → Account and settings → Expenses
Check that Track payments for 1099 is turned on.
Also confirm your company legal name, address, and Tax ID under:
Settings ⚙️ → Account and settings → Company
2. Make sure vendors are marked for 1099 tracking
Go to:
Expenses → Vendors
Open each contractor/vendor who should receive a 1099, then select Edit.
Check the box for:
Track payments for 1099
Make sure the vendor has:
Legal name or business name
Mailing address
Email address, if e-filing or emailing forms
Tax ID / SSN / EIN
A good practice is to collect a completed Form W-9 from each contractor before paying them.
3. Categorize payments correctly
QuickBooks uses the expense accounts you map to 1099 boxes.
Go to:
Expenses → 1099 filings
or
Taxes → 1099 filings
Then choose Prepare 1099s.
QuickBooks will guide you through mapping expense accounts to the correct 1099 boxes.
Common examples:
Payment TypeUsually Reported OnContractor services1099-NEC, Box 1Rents1099-MISC, Box 1Royalties1099-MISC, Box 2Attorney payments1099-NEC or 1099-MISC depending on type
For most independent contractors paid for services, you will usually use Form 1099-NEC.
4. Review eligible payments
QBO will show vendors and payment totals.
Review for:
Vendors paid $600 or more
Correct payment totals
Correct expense account mapping
Missing Tax IDs or addresses
Payments made by check, cash, ACH, or direct deposit
Important: Payments made by credit card, debit card, PayPal, Venmo, or third-party settlement networks are generally excluded from your 1099-NEC/MISC because those may be reported separately on Form 1099-K by the payment processor.
5. Fix missing or incorrect vendor information
If QBO flags missing information, open the vendor profile and update:
Expenses → Vendors → Select vendor → Edit
Add the Tax ID, address, and 1099 tracking status.
Then return to:
Taxes or Expenses → 1099 filings → Prepare 1099s
6. Preview the 1099s
Before filing, preview each form.
Check:
Payer name and EIN
Recipient name and Tax ID
Recipient address
Form type: 1099-NEC or 1099-MISC
Box number and amount
Total compensation
Do not file until the amounts match your accounting records.
7. File the 1099s
QuickBooks Online usually gives you two options:
Option A: E-file through QuickBooks
In the 1099 filing workflow, choose the e-file option and follow the prompts.
QBO can usually submit copies to the IRS and sometimes send copies to contractors depending on the service option selected.
Option B: Print and mail forms yourself
You can print copies for vendors and mail required copies to the IRS/state agencies, depending on filing requirements.
Use official IRS-compatible forms if mailing paper copies. Regular blank paper may not be accepted for IRS Copy A.
8. Send copies to contractors
Contractors generally need their copy by January 31 for 1099-NEC.
You can send copies electronically if they consent, or by mail.
9. Keep records
Save copies of:
Filed 1099s
Vendor W-9s
Payment detail reports
Filing confirmation
Any correction records
Keep these with your tax records.
Helpful reports in QBO
To review amounts before filing, run:
Reports → Expenses by Vendor Summary
or
Reports → Transaction List by Vendor
You can filter by date, vendor, payment method, and account to verify totals.
Common mistakes to avoid
Do not include payments made by credit card or PayPal if they are reportable by the payment processor.
Do not forget to map expense accounts to the correct 1099 boxes.
Do not issue 1099s to most corporations, unless an exception applies, such as certain attorney payments.
Do not wait until January to collect W-9s.
Do not file with missing or incorrect Tax IDs.
The usual QBO path is:
Expenses or Taxes → 1099 filings → Prepare 1099s → Map accounts → Review vendors → Preview → File
