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1099-NEC filing requirement with California

If you own a business you are aware of the requirement to issue 1099s to all service providers who are not corporations who you pay $600 or more by cash, check, or other bank transfer mechanism (e.g. Venmo).  For 2020, there are two big changes to the 1099 filing requirement::

  1. Payments for Non-Employee Compensation are no longer made on 1099-MISC, they are now made on form 1099-NEC. All other payment types (e.g. Rent) are still made on the 1099-MISC.
  2. A copy of the 1099-NEC must be sent directly to the California Franchise Tax Board.

 

Details about sending the forms to California

  • Form 1099-MISC gets sent from the IRS to the FTB each year, but the 1099-NEC does not get sent from the IRS to the FTB so employers must send copies of the 1099-NEC to California.
  • Employers do not have to send a red form to the FTB – you can send a photocopy of the 1096 and 1099-NEC to the FTB.
  • For paper filed forms, the due date is 2/28/2021.
  • The forms get mailed to: Franchise Tax Board P.O. Box 942840 Sacramento, CA 94240-6090

 

For more information, see the FTB website HERE.

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