The most significant change this year is the reviving of the 1099-NEC for any non-employee contractors. In the oil and gas industry, this includes working interest holders. You will now report these payments (including lease payments and bonuses) in Box 1 of the 1099-NEC.
You will still use the 1099-MISC to report payments to royalty owners. These lease payments (and bonuses) are recorded in Box 1, and the royalty income in Box 2.
Here’s a short video that highlights what has changed for the 2020 Tax Year:
Still have questions? Please contact us – we’re happy to help!
February 1, 2022 – Due to IRS and to recipients
February 1, 2022 – Due to recipients
March 1, 2022 – Due to IRS (if paper filing)
March 31, 2022 – Due to IRS (if filing electronically)
And remember, you can contact us with any questions!
Melinda joined the PetroLedger team in August 2019. She graduated from Baylor University and is a Certified Public Accountant. Melinda has more than 25 years of oil and gas accounting and management experience, as well as, outsourcing. She has been involved in transactional processing and reporting for public and private companies. She is passionate about providing outstanding timely and accurate client bookkeeping to support solid business decisions.
The journey from old to new oil and gas software can be an arduous one. On top of the complications that can arise during the data conversion process, many companies come to realize post-conversion that their new software may not be as good of a fit as they believed. But data conversions are costly, time-consuming projects; you really want to get these right the first time. With over 25 years of experience migrating client data, we’ll be there to help you make the decision that’s best for your business, whether your data comes from industry-standard applications, QuickBooks, legacy software, or any other unsupported systems. Our scoping process is thorough, and we’ll recommend the application we think is the best for you after some conversation about your needs. But before you decide to pull the trigger on a data conversion, here are three important questions your company should consider.
Nothing is scarier during Halloween season than knowing your 1099 filing deadlines are creeping closer. We know how much of an enormous headache the 1099 filing process is— that’s why it’s one of our most-requested services we offer to our clients. But there’s no need to stress this year: here is how outsourcing your 1099 processing can help you relax this season.
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