Tax season doesn’t have to be a scramble. Digits helps you stay ahead with up-to-date books, AI-assisted 1099 eligibility, and clean, automated financials—so you can deliver confidently to every client.
Review 1099 Vendors in Digits
You’ll find a Taxes section under Vendors, where ✨Digits AI automatically starts evaluating 1099 eligibility. You’ll have a clear workspace to manage 1099 and W-9 eligibility.
From the left navigation menu, click the Vendors tab.
Click Taxes in the top left.
What You’ll See in the Taxes View
Payment Method – Flags vendor payments made via bank accounts (potentially 1099-reportable) vs. credit cards (generally excluded).
Entity Type – Helps you determine if a W-9 is required. ✨Digits AI will try to automatically determine the entity type of vendors, but it gives you the ability to directly specify based on your unique knowledge.
W-9 Status – Mark vendors as Required / Not Required / Available / Unknown.
1099 Spend – Based on the method of payment (banks vs. credit cards), entity type, and amount of annual spend, Digits will automatically calculate the total 1099 eligible spend.
Workflow Tip: Confirm entity types during client onboarding. You’ll rarely need to revisit them unless a vendor’s status changes.
You can also:
Sort & filter by spend or W-9 status to focus on high-priority vendors.
Switch years with the year selector to manage prior or current tax years.
Edit anytime – Click Edit to update entity type, W‑9 status, or other fields inline.
Manually qualify 1099s (per vendor)
Go to Vendors → Taxes → Edit.
Click a vendor name (first column) to open that vendor’s transactions.
In the 1099 Qualification column, choose Qualified or Not Required for a single transaction or select a set of transactions to bulk-update their status.
Changes roll up to the vendor’s 1099 Spend total for the selected year.
Store & Track W-9s in Documents
The Documents tab keeps your W-9s organized and easy to find at year-end.
Upload anytime – Add W-9s to Documents as you receive them; ✨Digits AI will auto-recognize and name the files.
Filter by type – At year-end, filter Document Type = W-9 or 1099 to see what’s on file and what’s missing.
In Vendors → Taxes, set W-9 Status = W9 Available for vendors with a W-9 stored in Documents.
Workflow Tip: Request W-9s during onboarding or when a vendor crosses your 1099 threshold—this keeps year-end cleanup to a minimum.
Share with the Tax Accountant
You can collaborate in two ways:
Invite Colleagues to Digits with a no‑cost accountant seat so they can view exports and documents directly.
Publish & send a Year‑End Report (PDF/web) if they don’t need live access.
Need everything in Excel?
Go to Accounting → Ledger, click the ⋮ (top-right), and choose Download Financial Package. Digits exports one Excel file with tabs for Ledger, Trial Balance, Profit & Loss, Balance Sheet, and Cash Flow Statement—all in a single click.
Tip: For tax‑only or dormant entities, the Ledger‑Only plan is a lightweight option that still gives you AI‑powered ledger access and unlimited accountant seats.
Need to catch up a full year… fast?
Behind on the books? You can still get tax‑ready quickly:
Connect what you can (banks, payroll, payments). ✨Digits AI will start categorizing immediately.
Bulk import the rest from CSV.
Use Inbox to rapidly review anything the AI isn’t fully confident about (the system automatically surfaces the items that need your review).
Reconcile, review, publish, lock.
Tax-only clients? Check out the Ledger Only (Firm Plan)— $10/mo. Feeds stay live, AI keeps books tax-ready.
FAQs
Does Digits file 1099s or tax returns?
No. Digits provides the Taxes workspace to evaluate eligibility and track W‑9s; use your filing solution or CPA to file forms.
Where do I manage 1099‑related info?
Go to Vendors → Taxes to review AI‑assisted eligibility (bank vs card payments; entity type) and mark whether a W‑9 is required. Use Documents to store recognized, auto‑named W‑9s for easy filtering at year‑end.
Can I export my 1099-eligible vendors for filing?
Yes—open Vendors → Taxes, apply any filters (e.g., year, eligibility), then use Export to download a CSV of 1099-eligible vendors (and related totals). You can upload this to your e-file software or share it with your CPA.
Can I lock the tax year after we file?
Yes—Lock Periods will prevent edits after finalization
What if I can’t connect to a bank?
Bulk import CSVs into Ledger, and even turn PDF statements into CSV by dropping them into Documents first.
What if I don’t have a CSV file for my client’s bank transactions?
No problem—Digits can help with that. Just upload the bank statement PDF to the Documents tab, then click the three dots in the top-right corner of the file to export it as a CSV. You can then import that file into the Ledger.
