Filing a 1099-MISC and 1099-NEC

Filing Dates: File Form 1099-NEC on or before January 31, using either paper or electronic filing procedures. File Form 1099-MISC by February 28, if you file on paper, or March 31, if you file electronically.

Let us know if we can help you with your 1099-MISC and 1099-NEC filing needs:

Generally, any person, including a corporation, partnership, individual, estate, and trust, who makes reportable transactions during the calendar year must file information returns to report those transactions to the IRS. Persons required to file information returns to the IRS must also furnish statements to the recipients of the income.

To properly report the information required on Form 1099, you need to have the provider's taxpayer identification number (TIN). You can request that the provider fill out and give you a Form W-9, Request for Taxpayer Identification Number and Certification, before work is done or payments are made. If a provider does not supply you with a taxpayer identification number, you are generally required to "backup withhold" 28 percent from any "reportable payments."

File Form 1099-NEC for each person to whom you have paid during the year:

• Nonemployee compensation of $600 or more to individuals for services provided in the course of your trade or business.
• To anyone from whom you withheld federal income tax under backup withholding rules.

File Form 1099-MISC for each person to whom you have paid during the year:

• At least $10 in royalties or broker payments in lieu of dividends or tax-exempt interest.
• At least $600 in:
  • Rents (box 1);
  • Prizes and awards (box 3);
  • Other income payments (box 3);
  • Generally, the cash paid from a notional principal contract to an individual, partnership, or estate (box 3);
  • Any fishing boat proceeds (box 5);
  • Medical and health care payments (box 6);
  • Crop insurance proceeds (box 9);
  • Gross proceeds paid to an attorney (box 10) (see Payments to attorneys, later);
  • Section 409A deferrals (box 12); or
  • Nonqualified deferred compensation (box 15)

You may either file Form 1099-MISC (box 7) or Form 1099-NEC (box 2) to report sales totaling $5,000 or more of consumer products to a person on a buy-sell, a deposit-commission, or other commission basis for resale.

You must also file Form 1099-MISC for each person from whom you have withheld any federal income tax (report in box 4) under the backup withholding rules regardless of the amount of the payment.

Some payments do not have to be reported on Form 1099-MISC, although they may be taxable to the recipient. Payments for which a Form 1099-MISC is not required include all of the following.

• Generally, payments to a corporation (including a limited liability company (LLC) that is treated as a C or S corporation). However, see Reportable payments to corporations, earlier.
• Payments for merchandise, telegrams, telephone, freight, storage, and similar items.
• Payments of rent to real estate agents or property managers. However, the real estate agent or property manager must use Form 1099-MISC to report the rent paid over to the property owner. See Regulations section 1.6041-3(d); Regulations section 1.6041-1(e)(5), Example 5; and the instructions for box 1.
• Wages paid to employees (report on Form W-2).
• Military differential wage payments made to employees while they are on active duty in the U.S. Armed Forces or other uniformed services (report on Form W-2).
• Business travel allowances paid to employees (may be reportable on Form W-2).
• Cost of current life insurance protection (report on Form W-2 or Form 1099-R).
• Payments to a tax-exempt organization including tax-exempt trusts (IRAs, HSAs, Archer MSAs, Coverdell ESAs, and ABLE (529A) accounts), the United States, a state, the District of Columbia, a U.S. possession or territory, or a foreign government.
• Payments made to or for homeowners from the HFA Hardest Hit Fund or similar state program (report on Form 1098-MA).
• Compensation for injuries or sickness by the Department of Justice as a public safety officer disability or survivor's benefit, or under a state program that provides benefits for surviving dependents of a public safety officer who has died as the direct and proximate result of a personal injury sustained in the line of duty.
• Compensation for wrongful incarceration for any criminal offense for which there was a conviction under federal or state law. See section 139F, Certain amounts received by wrongfully incarcerated individuals.

Form 1099-K.

Payments made with a credit card or payment card and certain other types of payments, including third-party network transactions, must be reported on Form 1099-K by the payment settlement entity under section 6050W and are not subject to reporting on Form 1099-MISC. See the separate Instructions for Form 1099-K.

Attorney fee payments made to corporations generally must be reported on Form 1099-MISC.

If you fail to provide Form 1099s and cannot show reasonable cause for the failure, you may be subject to a penalty. The penalty applies if you fail to provide the statement by the deadline, fail to include all information required to be shown on the statement, or include incorrect information on the statement.

This list is not meant to be all inclusive and each taxpayer's situation is different. Please call our offices if you would like to discuss your specific tax deadlines and/or liabilities.

We can also assist you in preparing other 1099 forms such as 1099INT, 1099DIV and 1099S.

This site is not intended to provide tax advice, all information is referenced broadly and not to a specific situation, tax and accounting consequences will vary greatly with each set of facts and circumstances. The information on this site does not create a client relationship. If you have specific questions feel free to contact our office to set up an appointment.