At the beginning of the tax year 2021, the IRS has revived “Form 1099 NEC”. This new 1099 Tax Form has created lots of confusion in the gig economy. Besides, businesses faced lots of challenges when doing form 1099 NEC filing these tax returns with the Internal Revenue Service.
Along with confusion, Form 1099 NEC, the non-employee compensation return form has created a lot of headaches for the business owners. Overwhelmed? Yes, due to reviving the new 1099 NEC brought confusion to the states. Know more about Form 1099 NEC state filing consequences and check whether your state-required “1099 NEC Form filing” for 2022.
Table of Contents
- Form 1099-NEC Creates State Filing Headaches
- Is State filing required for 1099-NEC?
- When does a State require Form 1099 NEC filing?
- Is the new 1099 NEC included in the CF/SF program?
Form 1099-NEC Creates State Filing Headaches
In general, as the end of the year approaches, business owners, tax practitioners, accountants, etc must be ready with their form 1099 filing information handy. So, that they can minimize the risk of error filing or penalties and interests.
We all know that the “new 1099 NEC” was brought back in the tax year 2020 to clear the confusion created by the “PATH Act”. Reviving this new tax return had created a lot of state filing obligations. Because this is a new tax return and has not been included in the Combined Federal/State filing program.
Is State filing required for 1099-NEC?
As per the IRS rules and guidelines, State Filing 1099 is required when the taxes withheld exceeds the state income tax. Also, not every state requires filing 1099 NEC. Below are some of the states that require “Form 1099 NEC e-filing” annually?
| Alabama | Alaska | Arizona | Arkansas |
| California | Colorado | Connecticut | District of Columbia |
| Delaware | Florida | Georgia | Hawaii |
| Idaho | Illinois | Indiana | Iowa |
| Kansas | Kentucky | Louisiana | Maine |
| Maryland | Massachusetts | Michigan | Minnesota |
| Mississippi | Missouri | Montana | Nebraska |
For more info: https://www.form1099online.com/form-1099-cfsf-filing/
When does a State require Form 1099 NEC filing?
As mentioned above, not every state requires “IRS Form 1099 NEC ”. Among all the states, few states require a new 1099 NEC tax form filing if the state taxes are withheld. Otherwise, there is no need to file Form 1099 NEC with the state. They are listed below:
Arizona- requires state filing if withheld Arizona state taxes.
Arkansas- requires state filing if withheld Arkansas state taxes.
Colorado – Requires state filing if withheld Colorado state taxes.
District of Columbia- Requires state filing if withheld District of Columbia state taxes.
Delaware- Requires state filing if withheld state taxes
Georgia – Requires state filing if withheld state taxes
Idaho – Requires state filing if withheld state taxes
Indiana –Requires state filing if withheld state taxes
Iowa- Requires state filing if withheld state taxes
Kentucky – Requires state filing if withheld state taxes
Maine –Requires state filing if withheld state taxes
Michigan –Requires state filing if withheld state taxes
Minnesota –Requires state filing if withheld state taxes
Nebraska – Requires state filing if withheld state taxes
New Jersey – Requires state filing if withheld state taxes
North Carolina – Requires state filing if withheld state taxes
Ohio – Requires state filing if withheld state taxes
Rhode Island – Requires state filing if withheld state taxes
South Carolina – Requires state filing if withheld state taxes
Utah – Requires state filing if withheld state taxes
Virginia – Requires state filing if withheld state taxes
Is the new 1099 NEC included in the CF/SF program?
No, the new 1099 NEC Tax Return is not included in the Combined Federal/State filing program. As it is a new tax form, businesses must check their state filing requirements and file the tax return within the deadline. Under the CF/SF program, the IRS passes the respective 1099 tax form info to the participating states.
Check whether your state requires state filing 1099 NEC or not. Start filing your new 1099 NEC tax return with Form 1099 Online. We support state filing within the 1099 NEC deadline. Hassle-freely file 1099 NEC Form with the IRS & issue the respective copies to the states and the recipient’s on-time.