How Suspense Affects the 1099s

The amounts included on the 1099 are based on "History". History holds the amounts that have already been sent to an owner. Any amounts that are in suspense have not been sent to an owner yet so they are not in "History". Therefore, amounts in suspense will not be included on the 1099. Amounts that were in suspense prior to this year then released during this year will be included on the 1099 since they were sent to the owner this year.

For Example: If an individual earned revenue this year that went into suspense it will not include that amount on the 1099 since they were not actually paid for it yet. Likewise if they earned money in a prior year that was put into suspense then released this year, it will add that amount to the 1099 since they actually received the money this year.

If the option to "Only Include Revenue Earned this Year" is marked, suspense will not affect the owner's 1099. An owner's 1099 will then report only what he earned this year, regardless of what you actually paid them. Amounts earned last year that were released from suspense this year will not be included on the 1099. Amounts earned this year that are still in suspense will report on the 1099.