US clients and their contractors will have the opportunity to manage tax forms directly through Deel.
Clients can file 1099 Forms directly to the IRS directly from their Deel accounts!
In this article:
For whom do I need to file a Form 1099?
How to complete tax Form 1099-NEC
About tax Form 1099-NEC
When it comes to tax filing 1099s, the process is fairly simple.
Deel collects a Form W-9 from the contractor during the contract signing process. This form contains pieces of information required to file 1099s.
Deel clients with US entities can file the income of their US contractors with the IRS using the 1099-NEC form, as well as provide their US contractors with their copy of the 1099-NEC.
Before you file:
Before filling the 1099-NEC, make sure you have all the W-9 Forms for your US contractors. You can see the forms in the Taxes tab on your Dashboard.
While W-9 Forms are not sent to the IRS, you will need them saved for your records.
The contractor's W-9 needs to be complete and up-to-date.
Your entity details also need to be correct as a client, especially the Tax Identification Number (TIN).
You can review this under Entity Details in the Registration Number section.
If you need additional assistance on tax forms, you can contact us 24/7 and we’ll be happy to help you!
For whom do I need to file a 1099 form?
You need to file a 1099 for all US contractors who were paid $600 or more during the tax year.
This refers to total pay during the tax year, both via Deel and outside of Deel.
On Deel, “US contractors” are both US citizens, regardless of tax residence ; and non-US citizens who set their Tax Residence to the US.
- Total pay excludes the Deel fees and expenses, which Deel automatically deducts for payments through Deel.
- The relevant amounts are funds paid between Jan 1st and Dec 31st of the tax year, not the invoiced amounts.
- For example: If an invoice was issued in December, but your payment didn’t reach Deel until January, that particular payment rolls over into the total for the next tax year.
When do I need to fill out the 1099-NEC form?
1099s need to be filed from January 1st to January 31st following a tax year.
After the January 31st deadline, you can still file on Deel but penalties may apply. Please check the IRS website for any important updates.
We will send an email to both the client and contractor once their 1099-NEC forms have been filled.
How to complete the 1099 tax form
Jump to video tutorial
✅ Step 1 - Select the Taxes tab and select an entity
Contractors are listed per entity, and the filter shows one entity at a time.
This means you have to select an entity, file 1099 forms for the contractors belonging to that entity, and then repeat the process for each US entity (if you have multiple)
✅ Step 2 - Review form details
Entity details and W-9 forms can be updated if needed to make sure that 1099s can be successfully filed with the IRS.
If you paid your contractors outside of Deel, you can easily add those amounts with a few clicks.
✅ Step 3 - Click Review and File
✅ Step 4 - Click File to IRS to send paperwork to the IRS
You must send the paperwork to the IRS before January 31st, or penalties may apply.
Click Confirm on the final pop-up window.
Once filed, we’ll provide both you and your contractors with a copy of your 1099s that you can download anytime.
You can contact us if you need additional assistance on the 1099 form.
[ACCORDION] What happens if a US contractor gets paid in a non-USD currency?
Deel calculates the USD income using the rates supplied in the invoice data. Any extra amount we add is also added to the total. Both will be displayed in USD.
[ACCORDION] What if I am a non-US client and don't see the ability to file?
We may not have been able to generate 1099s for your contractors due to missing information (such as no TIN/EIN number). But your contractors can still report their self-employment income on Schedule C, without a 1099.
[ACCORDION] Will non-US contractors get a summary report of earnings for a given tax year?
We do not generate summary reports of earnings to non-US contractors.
But we do show the total amount in their Taxes tab next to their previously filled W-8BEN form. This will be displayed in USD.
[ACCORDION] Did you submit a W-8 BEN and don't see your 1099?
That's expected! You're all set and don't need to do anything further.
Note: Payments to independent contractors were reported with Form 1099-MISC until the IRS introduced 1099-NEC for tax reporting in 2020.
[ACCORDION] Are you working for a non-US client and don't see your 1099?
That's ok. You can still report your self-employment income on your Schedule C, without a 1099. Please see the full details here.
[ACCORDION] What happens if a contractor fails to file the required 1099-NEC form?
Please check the IRS website for latest information.