Hi there, @Accountant Julie,

The Invalid tax ID error in the 1099 E-File Service occurs when you assign a Social Security Number in the vendor's profile. The IRS will not accept 1099’s with SSN's formatted as XX-XXXXXXX, as it recognizes the difference between an SSN and a valid EIN.

To fix this, we recommend using a valid Tax ID for vendors eligible for 1099 reporting. For contractors who don't have these digits, they can use their SSN entered with three fields separated by hyphens: XXX-XX-XXXX.

Here's how:

1. In QuickBooks, select the Expenses menu from the navigation panel.
2. Go to the Vendors tab and pick a name on the list.
3. In the top right-hand corner of the vendor's profile, click the Edit button
4. In the Business ID No. box, retype the number like a Social Security Number, including the dashes, in this format XXX-XX-XXXX. The system will format the number as a Tax ID if the dashes are not entered.
5. Hit Save then process the1099 again.

I also recommend seeking a tax advisor or the IRS to verify this accordingly. To avoid any issues with the tax filings or not sure if you want to update the Tax ID format, you can always print and mail the 1099’s rather than E-file.

Here's an article to further explain the 1099 error you're getting: 1099 Invalid Information (Invalid tax ID).

If you need further help or clarification about this topic, please let me know in the comment. I'm always here to help when you need additional assistance. Have a wonderful day!