Set up 1099 form rules
Set up rules for your contractor expenses so they automatically record to a 1099 form, ready for filing at the end of the tax year.
How it works
- You must have the Advisor role to set up 1099 form rules.
- Xero uses your rules to search for transactions to add to the contractor's 1099 form. It filters out payments made by credit card or third-party services, such as PayPal. It also excludes expense claims.
- You can add up to 12 rules. For example, you might add separate rules for rent paid to a landlord and legal fees paid to an attorney.
Add 1099 form rules
- In the Reports menu, select All Reports.
- Under Tax, click 1099 Report.
- Select the report year.
- Click Set up 1099 Rules.
- Set up rules to find 1099 contractors and expenses. Under:
- Payments to – select the group you created for the contractor.
- Paid from – select the expense account you assigned to the contractor when setting them up as a contact.
- Report as – select the 1099 boxes you want the dollar amount to display in. If you're unsure about which box to use, see the Instructions for Form 1099-MISC (IRS website).
- (Optional) Click Add rule to add more 1099 rules.
- Click Save.