Adding and running payrolls for 1099 contractors is easy.
To start, simply add the contractors to OnPay like you do any other employee by going to the Employee Menu Icon > then selecting Add an Employee.
When you are setting the contractor up, you can use the first name last name spaces to input the company name if you are paying to a business as opposed to an individual. Also, if you need to use an EIN instead of a social security number, you can simply enter that where we ask for the social security number! Do not worry about how it is formatted, the IRS accepts the numbers in any format so long as they match the company/individuals name!
Once you have completed step 1, Enter Basic Information, and enter step 2, Enter Pay Information, the last step to make sure you can pay someone as a contractor is to add the 1099 Misc Wages Pay Item. Use the images below to see how:
Step 1: Add Contractor Basic Information
Step 2: Enter step 3 to Enter Pay Information. (You will need to click on step 2: Withholding Information but do not need to change any settings in this section.)
Step 3: Once in Step 3, Scroll down until you see "Pay Items" and choose Edit Items:
Step 4: Choose 1099 Misc Wages from the Select Pay Type drop-down, and click the blue +Add Item button. Once you see the 1099 Misc Wages pay item added to the box below, you can click the X in the top right-hand corner to return to the previous page where you will see the 1099 Misc Wages listed below regular and overtime.
Once you finish these steps you can now pay that contractor when you need to. Always make sure to use that 1099 Misc Wages pay item to pay the contractor to make sure all of those wages are tax-free and that they go onto the Form 1099 at the end of the year. Anyone can be paid 1099 wages in OnPay. Whatever wages you pay an employee/contractor using the 1099 Misc Wages pay item in OnPay will flow to their 1099 at the end of that year. We also offer several customizable 1099 pay items that you can edit in the Payroll Pay Items section of the Settings Menu. Using any of those custom 1099 pay items will also add to the amount on the Form 1099 at the end of the year.
Please let us know if you have any questions about how to add or pay 1099 contractors.