Overview of the Update Process

Starting on January 6th, you can update tax forms within Wingspan.

Any manual edit moves the form into an 'Overwritten' sync status, disabling automatic updates from recipient tax information or payables.

All manual adjustments are visible to teammates within the organization who have access to the recipient.

Types of Adjustments

Three primary adjustments are available:

Adjust the Amount: Modify the Non-employee Compensation amount on the 1099.
Edit Recipient Information: Update TIN, name, address, etc., on the 1099.
Update the Status: Change the 1099 status (e.g., Ready, Needs Action), separate from the 'Overwritten' sync status.

When Should You Update Tax Forms?

Updating tax forms is necessary in various situations, including:

Adding Missing Information: In cases where essential data is not present for filing, you can manually input it. For instance, if a paper W-9 is provided by a recipient, you can enter this data into Wingspan.
Inclusion or Exclusion of Forms: Depending on the specifics of your business, you might need to file certain 1099 tax forms that Wingspan includes by default or opt out of filing 1099s that are not relevant to your operations. As an example, certain corporations might mandate filing a 1099 for legal services. Keep in mind, Wingspan does not offer tax advice, so consulting a tax advisor is recommended.
Correcting Errors: Should you find an error in a 1099 form, such as an incorrect amount, you have the option to modify it to accurately represent the payment made to a non-employee.

Be aware that any changes you make will be accessible to all team members who have permission to view the 1099 recipient's details.

Detailed Procedures

Adjusting the Amount on a Tax Form

Before altering the amount on a tax form, confirm you have permissions to access all the recipient's tax forms. Lack of sufficient permissions might result in missing forms that reflect payments from other entities to the recipient, leading to an inaccurate correction.

To update the amount, be aware that this action will be visible as a manual adjustment to both your teammates and the recipient. The new total on the tax form is a combination of the sum of payables paid to the recipient (as per your calculation settings) and your manual adjustment. Note that the amount that appears on the tax form comprises payables processed through Wingspan or those uploaded by an administrator off-platform, depending on your calculation settings.

Workflow:

Click the 'Amount' field in the header of a Tax Form.
Enter the new amount. This is the total amount that will be displayed in the NEC section of the 1099 form, not a net adjustment.
Click 'Confirm' to apply the adjustment.

Constraints:

It's not possible to update the amount to $0. If you decide not to file the 1099, change its status to 'Excluded'.
Any adjustment you make will overwrite adjustments previously made by your teammates.

Editing the Recipient Information

Editing the recipient information allows you to update the address, name, or Taxpayer Identification Number that will appear on the 1099. Any edits to recipient information will be accessible to the email address associated with the recipient, so ensure

Workflow:

Select ‘Edit’ adjacent to 'Recipient details'.
Modify the tax information as needed. This includes changes to the business name, tax classification, address, and taxpayer identification number (TIN).
1. Be aware that editing the TIN or name triggers an immediate verification with the IRS.
Click 'Save' to finalize the changes.

Updating the Status on a Tax Form

You can manually override the status set by Wingspan for any tax form that hasn't been submitted to the IRS. Be aware that once a tax form is submitted, any manual updates will lead to the immediate submission of a correction.

Workflow

Click "Filing status" in the tax form header.
Select the updated status, and click "Confirm."

To learn more about 1099 statuses, please review this document: Understanding 1099 Statuses

Allowed Status Updates

Overriding to "Ready" Status

You may set a Tax Form to the "Ready" status if:

The current status is either "Needs Action" or "Excluded".
All required information (e.g., TIN, name, address, and amount) is complete (mandatory information details).
The amount is not $0.

Overriding to "Excluded" Status

You can set a Tax Form to the "Excluded" status if the current status is either "Ready" or "Needs Action".

A notice will appear on the tax form stating: "Manually excluded by {{name}} on {{date}}."

Overriding to "Needs Action" Status

You can set a Tax Form to the "Needs Action" status if the current status is either "Ready" or "Excluded".

Upon updating, a notice will be displayed on the tax form: "Status manually updated to 'Needs Action' by {{name}} on {{date}}."

Reverting Tax Form Updates

Manual updates made to a Tax Form can be reversed at any time. Reverting changes will restore the tax form to its initial state, based on the existing data in Wingspan concerning the amount, status, and recipient information.

Amount: The amount will be recalculated using your calculation settings from the payables in Wingspan.
Recipient Information: This will revert to the information provided by the recipient on file or the data batch uploaded by your team. Recipient information determination logic.
Status: The status will be recalculated based on the amount and recipient information.

Ensure that no vital information will be lost before reverting. Post-reversion, you can modify the amount, status, or recipient information again.

Reviewing Recipient Changes to the Tax Form

In cases where the tax form is in the 'Overwritten' sync state and the recipient updates their tax profile, the following notification will appear:

You can revert edits to recalculate the status, amount, and recipient details.

Upon receiving this notification, you can either revert to the original data from the recipient or maintain your updated information and file accordingly. The final content of the 1099-NEC is at your discretion as the payer.

Disallowed Updates

Certain updates are not permitted:

Identifiers: Changes to email addresses or external IDs are not allowed once a recipient is added. Ensure accuracy upon import.
Form Modifications: Wingspan does not support splitting or merging of tax forms.