1099 Kits and 1096 Transmittal Forms
A 1099 goes to someone who is not your employee. Contractors, vendors, landlords and other payees. Anyone on your payroll gets a W-2 instead, and the difference matters because misclassifying a worker carries consequences well beyond the paperwork.
NEC or MISC
Most dealerships need 1099-NEC. Since tax year 2020, non-employee compensation moved off the 1099-MISC onto its own form, so payments for services go on the NEC.
In a dealership that typically means contract detailers, porters engaged as contractors, mobile mechanics, transport drivers, inventory photographers, cleaners, consultants and IT contractors. The reporting threshold for services is generally $600 or more in a year.
1099-MISC covers other payment types: rent, if you lease premises from an individual; gross proceeds paid to an attorney; and prizes and awards. That last one catches dealerships out, because a promotional giveaway above the threshold is reportable to the winner.
Many dealerships need both. Check with your accountant which payments fall where before ordering, since the deadlines are not the same.
The Deadlines Are Different
1099-NEC is due to the recipient and to the IRS by 31 January, whether you file on paper or electronically. There is no later date for e-filing.
1099-MISC is due to the recipient by 31 January, but to the IRS by 28 February on paper or 31 March electronically.
The trap is assuming the March date applies to everything. It does not apply to the NEC. Treat NEC as a January job and MISC as a February or March job, and note that where a deadline falls on a weekend it moves to the next business day.
Check Whether You Are Required to E-File
If your dealership files 10 or more information returns in total, electronic filing is mandatory. That total aggregates across form types, so your 1099s count together with your W-2s.
Eight W-2s and three 1099-NECs is eleven returns, which means everything goes electronically. A waiver can be requested on IRS Form 8508. Confirm your own position with your accountant, since the obligation is yours.
You will still need the kits for recipient copies, which go out on paper unless the recipient has consented to electronic delivery.
Recipient Counts and Cost
The NEC kit covers up to 30 recipients; the MISC kit covers up to 20. Both include premium laser forms and envelopes.
Worth knowing when you are ordering both: the MISC kit costs slightly more for ten fewer recipients, so work from your actual counts per form type rather than buying one of each and hoping.
1096 Transmittal Forms
Form 1096 is the Annual Summary and Transmittal of U.S. Information Returns, required to accompany paper 1099 filings. One 1096 summarises all paper 1099-NEC or 1099-MISC forms of a single type.
Note that you need a separate 1096 for each form type you paper file, so NEC and MISC each get their own. Check whether your kit includes them before ordering, and add 1096 forms if not. If you are e-filing, the summary goes with the electronic submission rather than on paper.
Collect W-9s Before You Need Them
The practical advice that saves the most time in January. You cannot complete a 1099 without the payee's taxpayer identification number, and chasing a detailer who worked for you in March for their details in late January is a poor use of anyone's week.
Ask every new contractor for a W-9 before their first payment, and keep them on file. The dealerships that find this season painless are the ones that did this in April.
Related Tax and Payroll Supplies
See W-2 kits and W-3 transmittal for employees, and remember both count toward the same e-filing threshold. Browse all tax forms.
See also car dealership accounting forms, purchase order books for the vendor spend behind these filings, HR and employment supplies and custom printed envelopes.
