Guide to Managing Contractors on Found

Overview

Found makes it easy to manage contractors that your business hires, pay them for their services, and stay on top of the tax paperwork needed to report those payments.

At the end of the tax year, Found will create your 1099-NEC forms based on all tracked payments over $600. You can then easily share a copy with your contractors and even e-file these forms via the Found app, for free.

Better yet: with everything tracked in one place, there’s no need to reconcile these transactions across platforms. Each payment is automatically recorded as a deductible expense in your Activity feed, helping you to lower your taxable income.

How to manage contractors in Found

Step 1: Onboard contractors

Tap Add Contractor in the Contractors section of the app or the Payment section of the mobile app.

Choose a contact in your contact list or tap Create New Contact to add a new contact. If adding a new contact, include their name, phone, email, and address to get started. You can also add their business name and banking details.

Once you’ve added a contractor, be sure to request or add their W-9 information, which has their tax identification information needed for your 1099-NEC forms. You can keep track of W-9s requested and send reminders to contractors in the W-9 forms tab (see Step 4 below).

Step 2: Update payment delivery method

To start a contractor payment, select Pay Contractor in the Contractors section on desktop or the Payments section on mobile.

Enter the payment amount and select the contact you’d like to pay. 

By default, the contractor will receive a payment notification via email or text message with options on how to receive the payment. You can update this preferred payment delivery method by clicking Edit next to the recipient contact, selecting Update payment delivery, and choosing another notification option.

Tip: You can send a payment directly to their bank account number and routing number instead of letting them choose via email / text message. To do this, select Edit next to the recipient contact, then Edit this contact, then select the drop down next to Default payment delivery, select Bank account, and enter their bank details.

Step 3: Pay contractors

You can send this payment immediately, schedule it for later, or save it as a draft to finish later when convenient. You can also require a contractor’s W-9 before they can accept payment by selecting the checkbox next to Require W-9.

If your contractor uses Found, you can instantly send payments from your Found account to theirs—for free. 

Any payment made to a contractor will be auto-categorized as “Contractor Services” in your Activity feed and your quarterly tax estimate will be updated to incorporate that new deduction.

Learn more: How do I make payments in Found?

Step 4: Track and request W-9 forms

You can see all of the W-9 forms that you’ve requested in the W-9 forms section on desktop, or the Contractor profiles section in the mobile app.

View the status of each contractor’s forms and easily request them to share or send a reminder via email or text message.

Step 5: View and send 1099 forms

Found tracks contractor payments throughout the year and automatically generates 1099-NEC forms for any contractors you’ve paid over $600, using the W-9 information you’ve collected.

You can view these in the 1099 forms section on desktop, or the Contractor tax forms section of the mobile app. Select any contractor to view their 1099-NEC.

During January, you can select Send 1099 to email your contractor a copy of this 1099 form.

Step 6: E-file 1099 forms

Remember: in addition to sending a 1099 form to each contractor you’ve paid over $600, you will also need to file these forms with the IRS.

Found users are able to e-file these forms directly from Found between January 1 and January 15.

During this period, click File 1099s. Confirm that each contractor’s contact information is correct and payment information is up-to-date, and then click Submit.

If you miss Found’s e-file deadline or would prefer to file yourself, you can still submit these forms to the IRS directly. Select File on your own when prompted and follow the instructions provided. Your 1099s will be sent to your email address.

Learn more: How do I view, create, and file 1009-NECs with Found?

Following these simple steps will help you to easily onboard and pay contractors throughout the year and hopefully prevent a last minute scramble for tax forms during tax time.

If you’d like to send non-contractor payments through Found, make sure to check out our additional resources on How to Send Payments with Found.