Vendor & contractor payments

What are vendor payments?

Vendor payments is the money-out side of Merchant360: a place to track the vendors and contractors you pay, keep each one's W-9 on file, and have the year's totals roll straight into a 1099-NEC at tax time. It's the mirror image of invoicing, where you get paid.

Find it at Billing Accept Payments → Vendor Payments. The top of the page shows three numbers at a glance: how many payees you have, how much you've paid them this year, and how many are at or over the $600 IRS threshold that triggers a 1099-NEC.

Add a payee

A payee is anyone you pay who might need a 1099-NEC: a freelancer, a contractor, a landlord, a service vendor. Add them once and every payment you record rolls up under them.

1. 1Click Add payee. Choose Business or Individual – this decides how their name is treated on the W-9 and the 1099.
2. 2Enter their name and, when you have it, their address, email, and phone. The address is what prints on their 1099-NEC, so it's worth getting right.
3. 3Enter their tax ID (SSN or EIN) from their W-9. It's encrypted the moment you save it; only the last four digits are ever shown back to you.
4. 4Leave "Include in 1099-NEC totals" on for anyone reportable. Turn it off for a payee who never needs one (for example, a corporation you're not required to file for).

Record a payment

Recording a payment tells Merchant360 you paid a vendor – whether you sent it by check, cash, bill-pay, or an ACH from your bank. It does two things: it books the amount as a business expense so your Profit & Loss stays honest, and it adds to that payee's reportable total for the year.

1. 1On a payee's row, click Record. Enter the amount, the date, and an optional memo (what it was for).
2. 2Leave it marked reportable if it counts toward their 1099-NEC. Save it.
3. 3The amount immediately books as a Contractor expense in your bookkeeping and updates the Paid this year figure on the payee's row.

Collect and store a W-9

You need a W-9 on file for anyone you'll send a 1099-NEC. Merchant360 both generates one to send and stores the signed copy, encrypted, so you're not chasing paper in January.

1. 1On a payee's row, click W-9. You can download a prefilled W-9 to send the vendor – their name and address are already filled in, so they just confirm, sign, and return it.
2. 2When the signed form comes back, use Record W-9 to file it: enter the details and the name it was signed under. Merchant360 generates the executed PDF and stores it encrypted against that payee.
3. 3Once a W-9 is on file, the row shows a W-9 link you can click any time to download the stored copy.

Verify a payee's TIN (IRS TIN Match)

Before you file a 1099, it's worth confirming the payee's legal name and tax ID actually match IRS records. A wrong name-and-number pairing is the most common reason a 1099 bounces and triggers an IRS B-notice. TIN Match checks the pair against the IRS TIN Matching service for you.

1. 1On a payee's row, click Verify. Merchant360 sends the name and the tax ID you have on file to the IRS and shows the result right on the row.
2. 2A green MATCH means the name and TIN line up with IRS records. A MISMATCH means they don't – double-check the spelling and the number against their W-9, fix it, and verify again.
3. 3The result is stamped with the date it was checked, so you have a record that you did your due diligence.

1099-NEC rollup at tax time

When a payee crosses $600 in reportable payments for the year, they show up in the 1099-NEC panel at the bottom of the page, ready to file. Merchant360 adds up every reportable payment you recorded, so there's nothing to tally by hand.

1. 1Pick the tax year from the dropdown to see who's reportable for that year and their totals.
2. 2For each payee, click Download 1099-NEC to get the recipient copy – the one you send your contractor – with your business as the payer and their details filled in.
3. 3Send each contractor their copy by the IRS deadline (typically January 31).

Pay a vendor by bank (ACH)

Recording a payment (above) logs money you already sent. Separately, Merchant360 can also send the payout for you as a bank (ACH) credit, pulling the funds from your account and depositing them to the vendor's – so you don't have to cut a check or leave the app.

This is a controlled feature: sending real ACH payouts is turned on per account once the compliance certification is in place. Until then, use Record a payment to keep your books and 1099s accurate for payouts you send by check, cash, or your own bank's bill-pay.