How to Track 1099 Vendors In Quickbooks Online

As a busines owner, you may come across the need to track a contractor’s information in Quickbooks Online. Information such as Full Name or Business name, address, EIN or SSN. All this information should be provided to you on a Form W9 in which your contractor fills out.

It is a good recommendation for your business to collect the following forms from any individual or business that is performing a service for you, landlord you are paying rent to or even prizes/awards that you are giving out that exceeds $600.

• Form W9 – Request for Taxpayer Identification Number

• Certificate of Insurance – from vendors that are performing a service on your project where liability concerns and the possibility of financial loss can occur. Example – someone getting injured on your job site

Businesses are not perfect; however, I always recommend to my clients to get these documents from their vendors/winners before they issue payment. Once they are gone, they are gone.

There is a simple 2 Step Process to accomplish this task.

Step 1: Request the documents from your vendor/winner. Once you receive the necessary documents, quickly review them to ensure everything is filled out properly and they have signed it.

Step2: Enter the information into Quickbooks Online to begin tracking money paid.

To enter this information you will first need to Log into your Quickbooks Online

Next You will hover over “Expenses” then click on “Vendors” to take you to the Vendor Section.

From here, it depends on if this is a new vendor you are entering in Quickbooks Online or if this vendor already exists and you need to update the information.

For a New Vendor

Click on the green button labeled “New Vendor”

A window will pop up prompting you to fill out the Vendor Information

Depending on who the vendor/winner is, you will need to fill out either the “First/Last Name” and/or “Company” fields.

Please note that if you fill out both fields, the “*Display Name” will usually prompt as the “First/Last Name”. To change this simply click on the drop-down menu and select the “Company Name”.

Continuing down the window, fill out the “Address”

If you have an email address, feel free to enter that as well. The benefit to filling that out is that if/when you file your 1099s through Quickbooks Online, Quickbooks will send an electronic copy of the 1099 directly through email to your vendor in addition to mailing a paper copy.

Eventually, you will make it down to the “Business ID No.” and a check box for “Track Payments for 1099”. The “Business ID No.” field is where you will enter the EIN or SSN according to the Form W9 provided to you.

The next CRITICAL step is to check the box for “Track Payments for 1099”. If you don’t check this box, this vendor will not show up on any 1099 year end reporting or any reporting for your workers compensation audits you may go through.

The last field to fill out is the “Default Expense Account”.

If this vendor is only going to be categorized to a single chart of account such as “Contractors, Subcontractors, Consulting Expense” then you can assign that account to this vendor. It will automatically prefill any bills, checks or expenses you record in Quickbooks to this account.

If this vendor will be assigned to multiple accounts throughout the course of business, then Leave this blank.

Bonus Tip: You can take advantage of using the attachments box to attach any information that pertains to your vendor. I use this feature to attach COIs, Contracts, Form W9s and anything else that we may need that directly pertains to this vendor.

Finally, once all of this window has been filled out to completion you can click “Save”

For an Existing Vendor

Either scroll to the vendor you are updating or click on the search bar and search for their name.

Once you find them, click on their “Name”, which will bring you to their vendor file

Click on the top right “Edit”

Fill out any of the missing fields as suggested previously in the “New Vendor” section of this tutorial.

Its pretty simple and easy to do in Quickbooks Online and will save you a ton of time and energy in the long run trying to gather and fill out this information. Especially, if you use the built in 1099 filing tool that Quickbooks Online provides to you. The hard part is done, just review your 1099 reports and file!

I hope this video was help in teaching you the quick and simple steps to entering in your vendor information for tracking 1099s.