QuickBooks Payments to 1099 vendors made via credit card, debit card, or third-party system, such as PayPal, are excluded from the 1099-MISC and 1099-NEC calculations. This is because the financial institution reports these payments, so you don't have to. If you pay an independent contractor by credit card, debit card, or by using a third-party settlement organization (TPSO) like PayPal or Payable, you don't have to file a 1099-NEC with the IRS. No, You don't need to prepare a 1099-NEC or 1099-MISC for credit card payments. These forms are only necessary if you pay the contractor with cash, check, or a. similar method. The payment settlement entity, such as the credit card company, is responsible for reporting credit card payments. Payments made with a credit card or payment card and certain other types of payments, including third-party network transactions, must be reported on Form 1099-K by the payment settlement entity under section 6050W and are not subject to reporting on Form 1099-NEC [and Form 1099-MISC].” If you pay independent contractors, you may have to file Form 1099-NEC, Nonemployee Compensation, to report payments for services performed for your trade or business. Contractors and small businesses: Learn whether you need to issue a 1099 for credit card payments and avoid common IRS reporting mistakes. Yes, any payment made via a debit card is treated like a credit card payment and is reported by the bank on Form 1099-K, meaning you do not need to issue a 1099-NEC. Yes, you can skip 1099-NEC and 1099-MISC forms for payments made by credit card or third-party platforms like PayPal, Stripe, or Square. The payment processor handles that reporting through Form 1099-K. Payments made with a credit card or payment card and certain other types of payments, including third-party network transactions, must be reported on Form 1099-K by the payment settlement entity under section 6050W and are not subject to reporting on Form 1099-MISC or Form 1099-NEC. Do you send a 1099 to vendors paid by credit card? No. Learn why credit card payments are exempt from 1099-NEC reporting to avoid IRS double-reporting errors.