End of Year 1099 Feature

Comissio tracks 1099 for Agents and can manage the End of Year (EOY) 1099 Process. At the end of the year the total of the compensation can be used to create 1099 records, generate 1099-MISC Forms, notify Agents - who can then see their form in their Dashboard, and submit the forms to the IRS.

Summary of pages and processes related to 1099 process

System setting for 1099 minimum threshold amount that defaults to the current IRS mandated amount of $600.
Permissions in Roles for Users can be set to allow or restrict access to the 1099 EOY page.
End of Year 1099 process list page.
1099 record detail page.
Option to Run on the End of Year 1099 Process list page.
Option to generate 1099 Form in list and detail page.
Option to Submit to IRS in list and detail page.
Ability to merge 1099 compensation amount from individual 1099 records of Agents that have the same Tax ID
Compensation can be updated from the detail record and note required for change.
Form 1099 Update import can be used to update compensation or change status of Records.
Audit report displays changes to 1099 records including notes to include reason for changes.
1099 Form saved and displayed in three locations: EOY 1099 detail pages, Agent Details, and the Agent Dashboard.
Individual Agents can be set with ‘Bypass 1099, so 1099 forms are not generated.

Steps for End of Year 1099 Process

Create adjustments throughout the year to make corrections as needed to 1099 Amounts. (An Adjustment cannot be used to correct the 1099 amount after the year ends, however the compensation amount in the 1099 record can be edited.)
Prior to beginning the End of Year 1099 process, confirm with the Agents that their name, tax ID, and address are correct. Agents can access a 1099 Info page in their Agent Dashboard to review their 1099 and can check a box to show they have confirmed their 1099 info is correct.
Close the last cycle for the year within the intended year. The 1099 amount is based on the actual date when the cycle is closed, not on the Processing Date. So, if the processing date is 12/29/2025, if the actual date the cycle is closed is 1/2/2026, the 1099 amount from the commissions in the cycle will be counted in the year 2026.
From the End of Year Process page, select the year and then ‘Run’ to generate records for Agents whose compensation is over the threshold amount.
If needed, manually create 1099 Records that were not created when Run was selected. This might be needed for an Agent with less compensation than the Threshold amount.
If needed, edit 1099 Records to change the compensation amount. For example, 1099 may need to be increased due to non-monetary payments like an award trip provided by an Issuer to an Agent. A note is required for changes in compensation.
If needed, put Agents’ 1099 records on hold to prevent the records proceeding to the next step like to generate 1099 Forms or be sent to the IRS.
If needed, use Form 1099 Update Import to update Compensation amount or change status for multiple Agents.
If there are Agents with the same Tax ID, one must be selected to have the full compensation amount consolidated into that Agent. The 1099 records for those Agents will start with status ‘On Hold.’ After one is selected as the Primary, that Agent’s record will be changed to Open Status, the other Agents will be changed to ‘Merged’ Status (as in compensation merged out for them).
Selecting ‘Generate 1099 Forms’ will generate the forms for records in Open Status. This can be done from the list page, or within a 1099 record. The 1099 Records that had forms generated will be changed to Status ‘Pending.’
After generating 1099 Forms, a notification is sent to the Agents directing them to log into their Dashboard to view their 1099 Form. THE 1099 FORM GENERATED AT THIS POINT HAS A WATERMARK ‘DO NOT SEND TO THE IRS’ ON IT. THIS WILL BE REPLACED BY A COPY THAT DOES NOT HAVE THE WATERMARK AFTER THE RECORD IS SUBMITTED TO THE IRS.
Edit any 1099 records as needed. Saving after editing a 1099 record will return them to Open Status. Selecting ‘Generate 1099 Form’ will generate a new form to replace the previous one and return the record to Pending which is the status needed to be able to then submit them to the IRS.
Select ‘Submit to IRS’ to electronically send 1099 records that are in Pending status to the IRS. The Status of the record will change to submitted AND THE 1099 FORM THAT WAS SAVED AND VISIBLE TO AGENTS IS REPLACED BY A VERSION THAT DOES NOT HAVE THE WATERMARK.
Use the search filter to look for any 1099 records to troubleshoot if needed.
Tenants will need to mail copies of the 1099 Forms to all Agents that have not met their organization’s requirements for approval for only receiving the forms electronically.
The IRS will return a status report of Accepted or Rejected. The 1099 record will be updated to display that status. The IRS usually takes several weeks to return with the Status. It is suggested to set reminders to check the status of all records later. Review any exceptions as needed.
Ater the submitted 1099 Records are updated with an accepted or rejected status, they can be edited. If a Form is updated after it was submitted to the IRS, an updated version of the 1099 Form can be generated and submitted to the IRS and the new and previous version of the 1099 Form would be stored.
Use the Audit Report under the Utilities menu with Category EOY 1099 process as needed to investigate changes to 1099 records.

Comissio Tracks Agents 1099

Comissio automatically tracks Agents 1099 balance. Commissions calculate 1099 amount equal to the gross commissions. Chargebacks reduce 1099 as well as reduce Net and Agent Balance. Adjustments with ‘Apply to 1099’ checked will affect the 1099 balance. Each cycle will display the 1099 amount for each Agent in the Summy page in their Statement. Agents will see the 1099 activity for that cycle as well as the Beginning YTD and Ending YTD 1099 amounts for that point of time.

Summary portion of Agent Statement with Form 1099 section outlined:

Bypass 1099 Option in Agent Details

There is an Option to ‘Bypass 1099’ in the Payment Options page in Agent details. When selected the 1099 amount details will not be displayed in Statements and a 1099 record will not be generated when the End of Year 1099 process is run.

Payment options page within Agent Details with Bypass 1099 option outlined:

Summary portion of Agent Statement who has Bypass 1099 checked:

1099 Threshold System Setting

A System setting is available to change the default from the current minimum income threshold of $600.

The IRS mandates that all companies must create and file a Form 1099-NEC (Nonemployee Compensation) when your business pays a non-employee (such as an independent contractor, freelancer, or consultant) $600 or more for services in a calendar year.

Even if an Agent earns less than $600 and does not receive a 1099-NEC or 1099-K, the Agent is still required by the IRS to report all income on their tax return. While businesses are only required to issue a 1099 form for payments of $600 or more, income below this threshold is still taxable, and they must report it to avoid penalties and interest.

Setting page for 1099 Minimum Threshold:

Permissions within User Roes can limit access

Users who are to have access to the End of Year 1099 Process page must have a role with that page checked.

Manage Permissions page within a Role with the End of Year 1099 Process checkbox outlined:

End of Year 1099 Process

The 1099 End of Year process is managed from a page under the menu for Utilities. From these page 1099 records are created, 1099 Forms generated, and forms can be electronically submitted to the IRS.

End of Year 1099 Process list page with menu path outlined. No records are displayed prior to selecting the year and ‘Run’:

To begin the End of Year 1099 Process, select the year and then select Run. The system will bring back all Agents that have 1099 income that is equal to or greater than the Threshold setting and display in this list page.

If you leave the 1099 page and then return, selecting the year will bring up the previously generated records. If you select ‘Run’ again it will update all open and ‘On Hold’ status records and bring back any compensation amounts back to the original system amount before any changes.

End of Year 1099 Process list page showing records displayed after selecting year and ‘Run’:

1099 Record Detail page

The details of the record for an Agent can be viewed or edited by selecting Edit/View 1099 Record.

Option to go to a 1099 record from the End of Year 1099 Process list page:

An Agents compensation amount can be changed from the 1099 detail page. When making a change to compensation a note is required to be entered to use to store the reason for the change.

Corrections to other details (name, address, and Tax ID), need to be changed from the Agent Details and 1099 info page available to Admin.

Detail page for 1099 Record with compensation field outlined:

Merging Agents Compensation

If more than one Agent records share the same Tax ID, the compensation need to be merged into one 1099 record. The record will initially be set to status ‘On Hold.’ When viewing one of the Agents’ records, compensation for each of the Agents with the same ID is displayed in a section for Combined Compensation.

Once an Agent is selected as Primary, the total compensation will be moved to that Agent, and other Agent 1099 records will be left with $0.00. The status on the record with the total of the compensation will change to Open. A note will be added to the record for that Agent, ‘Compensation increased when made primary.’ Once saved, that record will then be ready to have the 1099 form generated. The other Agents 1099 record will have a status of ‘Merged,’ will have a note added ‘Compensation decreased when not primary,’ and will not generate a 1099 Form.

Detail page for 1099 Record for Agent who shares tax ID with another Agent Record with Combined Compensation field and Primary selection outlined:

Detail page for 1099 Record for Agent who shares tax ID showing how when Primary selected all Compensation is added to the selected Agent:

Form 1099 Update Import

The Form 1099 Update import can be used to change the Status of Agents 1099 records and to update Compensation.

Import Page with Import Type and Import Name outlined for the Form 1099 Update Import:

The template for the Form 1099 Update import is found with the templates of the other Import Types.

Template for Form 1099 Update import:

Details on the Import:

The CompChangeAmount in the import file will add or subtract from the Compensation amount in the Agents’ 1099 record, it does not replace the compensation amount. A positive dollar amount will increase, and a negative dollar amount will decrease the existing total Compensation for an Agent.
When there is to be a change in the Compensation a Note is required. The note will replace any previous note in the record. Previous notes can be seen by using the Audit Report.
The import can be used for all Agents that share a tax ID with other Agents prior to one being selected as the Primary. After a Primary is selected, then only the Primary can have their Compensation changed using the import.
This import cannot be used to select an Agent to be the Primary for Agents who share the same Tax ID.
1099 records that have been submitted and accepted by the IRS (Accepted Status), cannot be changed using the import.
The import can also be used to only change the Status of the 1099 records, for example to change ones in Open Status to On Hold, so those records are not processed.
The import will allow entering Status of Open, On Hold, or to leave the Status field blank.
1099 records changed from another Status to Open will then require generating the 1099 Form and being submitted to the IRS.
Changes for Status and Compensation for records will depend on the status of the existing 1099 Record and value entered for Status in the import file as is displayed in the following chart.

Table for changes based on Status of existing record and Status entered in the 1099 Form Update file:

Generate 1099 Form

Generate 1099 Form can be selected once all the 1099 Records have been reviewed and any changes have been completed. This can be selected from the 1099 End of Year list page to generate forms for all records that are open or from within an individual record. After selecting Generate 1099 Form, the status of the records where forms have been generated will change to ‘Pending.’

The 1099 Form created and saved will have a watermark that says, ‘Do not send to the IRS.’ This version is replaced by a 1099 form without the watermark when the record is submitted to the IRS.

End of Year 1099 Process list page with Generate 1099 Forms option outlined:

1099 record detail page with Generate 1099 Forms option outlined:

After the form for Agents has been generated, the form can be viewed from the 1099 record, from a tab within the Agents records, and by the Agent in their Dashboard.

1099 record detail page with View Form 1099 option outlined:

The form contains three pages, Copy B for Recipient, Copy 1, and Copy 2. Displayed here is the first of three pages. This is the version showing the watermark. Once submitted to the IRS, the form is replaced by a version without the watermark.

1099-NEC form Copy B for Recipient:

If there are errors preventing a form from being generated, the record will stay in open status and exceptions can be seen from within a record after clicking on an ‘Exception’ link. There is a link to the exceptions from the list page and one from the 1099 record. The exception link is not displayed unless there are exceptions.

1099 Record detail portion with Exception link outlined:

Example of an error:

‘24/4/2024 15:12:32 - Zip Code is incorrect, ZIP code doesn't match for the state, check for State and ZIP code for: 456742484 for BB1201 Bobzx Borgenstein’

Email sent to Agents when 1099 Form is generated

When the 1099 Form is generated, an email will be sent to each respective Agent letting them know the form is ready for their review. A tenant should inform the Agents that the original form will have a watermark but will be replaced with one that does not have the watermark.

Email notification sent to Agents when their 1099 Form has been generated:

The link in the email will take the Agent to their Dashboard where they can log in and see their 1099 form. Note: Only making forms available electronically and not also mailing a copy requires approval from the respective Agents.

Agent Dashboard 1099 Forms page with tab for page outlined:

Admin view of Agents 1099 Forms

Admin will also be able to access Agents 1099 forms from a page within Agent Details.

Portion of the Agent/Org list page showing option to go to the Agents 1099 Form:

Form 1099 page within an Agents detail page:

* Refer to the information on Form 1099 page under Agent & Organizations for more details on this page.

Submit to IRS 1099 Forms

After generating forms, the 1099 Records can then be submitted electronically to the IRS.

1099 record detail page portion with Submit to IRS outlined:

The status changes to Submitted after selecting Submit to IRS.

The IRS will then take weeks before a return process will change the status to Accepted. If there are any issues or refusal by the IRS, for example if the Tax ID were faulty, the status will change to Rejected and an exception is displayed under exceptions.

After a status of Accepted or Rejected is received back from the IRS, the 1099 record can be edited and resubmitted if needed. If a 1099 record is updated after previously being submitted to the IRS, an updated version of the form will be created and saved along with the previous version.

Filter in the End of Year 1099 Process page

The left side Filters section can be used to search for 1099 records by different criteria. The Funnel icon opens or closes the Filters section. This can be helpful, for example when responses are received from the IRS to look for any that were rejected.

End of Year 1099 Process list page with Filters section opened:

Creating a manual 1099 Record

1099 records can be created for Agents that were not automatically created in the EOY process, for example when the Agent earned less than $600 but is requesting a 1099 record. After selecting ‘Create a Manual 1099’, selecting the desired Agent, and ‘Create 1099,’ a 1099 record for that Agent will be created.

End of Year 1099 Process list page with option to Create a Manual 1099 outlined:

Manually add 1099 detail page:

Close Year for 1099

There is an option to mark the year closed. After selecting the year, selecting ‘Close Year’ does not prevent further editing but is a way to mark a year as having completed 1099 activities.

End of Year 1099 Process list page with Close Year option outlined:

End of Year 1099 Process list page after selecting Close year showing message and ‘Closed Year’:

Agent 1099 Form Information Report

The Agent 1099 Form Information Report primary purpose is to support the use of the checkboxes for ‘Electronic Consent’ and ‘Reviewed 1099 Info.’ Agents will see those in their Agent Dashboard and can check them to let Admin know they approve receiving their 1099 form electronically so mailing a copy is not needed, and that they confirm their 1099 info (name, Tax ED, address) are correct.

Agent 1099 Form Information report:

Elements of the Form 1099 compensation

An Agents’ compensation amount that populate their Form 1099 at the end of the year can contain the following elements:

Form 1099 Amount that appears in the Agents’ Statements: This includes commissions, affects from Adjustments with ‘Apply to 1099’ checked, and is decreased by Chargebacks that have been applied. Reports on Commission History, Adjustments, and Chargebacks are available to both the Agent and admin for additional research into these items.
Agent Balance & 1099 Import: This import is typically only used when transferring balances from a legacy system. If there were imported 1099 Balance imported prior to the first cycle, it would be Beginning Year to Date amount seen in the 1099 section of the summary in their Agent Statement. If the import to bring in a 1099 amount was used after the first cycle, the imported amount would be the difference between the Ending Year to Date 1099 Amount from one cycle and the Beginning Year to Date seen in the next cycle.
Changes to the Compensation amount in the EOY 1099 Record or by the Form 1099 Update Import: After a Form 1099 record is generated, Compensation can be changed. If there is more than one Agent sharing the Tax ID, all the Compensation needs to be consolidated into one Agent ID. Any time there is a change in compensation a note should be left for the reason and then the audit report can be used to display the changes and view notes.