1099/W2 Indicator on the Vendor 1099 Log

A common question about 1099/W2 processing is whether a “W-2 employee” can also receive a 1099 from the same employer. The correct answer is “it depends.” For example, you cannot use a 1099 to report employee expense reimbursements. But, if that employee has a side-business, then a W2 and 1099 may be appropriate. 

So, you need to look at the each situation. Watch this video to see how I run the Vendor 1099 Log (ReqPay07) to find employees that are also receiving a W2 and determine if the situation is appropriate. Through a quick series of steps, I will discover that a part-time custodian also owns a towing service. Obviously, towing cars is not a custodial duty, so this is a situation where a 1099 and a W2 would be appropriate.

Please keep in mind that Escape Technology is a software vendor and we do not give legal or tax advice.  You are advised to follow up with your own legal or tax adviser.