Free tool
Do I need to send a 1099?
Answer four questions about a person or business you paid. We tell you whether you likely need to send a 1099, and what to do next.
Prefer to talk it through? Take the free books check or contact us.
How it works
The usual rules
You generally send a 1099-NEC for payments for services to someone who is not an employee and is not a corporation, when you paid them at least the reporting amount in the year. For payments made in 2026, that amount is $2,000, up from $600 in earlier years. Check the figure each year, because it can change. Rent for business property is reported on a 1099-MISC.
You generally don't send a 1099 for payments to corporations, for goods or inventory, for personal spending, or for payments made by credit card or through a payment app, because the payment company reports those. Lawyers and some other cases follow special rules.
The best habit is to get a Form W-9 from every contractor before you pay them. Forms are due to the person and the IRS by January 31 of the next year.
FAQ
About this quiz
What is the 1099-NEC?
It is the form businesses use to report payments of at least the reporting amount for services to someone who is not an employee. The business sends a copy to the contractor and files a copy with the IRS.
What is the reporting threshold?
For payments made in 2026 it is $2,000. It was $600 for earlier years. The amount can change in later years, so check the current IRS instructions.
Do I send one to a corporation?
Usually not. Payments to corporations are generally exempt, with exceptions such as attorneys' fees. A W-9 from the contractor tells you how they are taxed.
What about payments by credit card or PayPal?
Payments made by credit or debit card or through a payment app are reported by the processor on a 1099-K, so you generally leave them off your 1099-NEC.
Is this legal or tax advice?
No. The quiz gives a likely answer based on the usual rules. Special cases exist, so confirm with the IRS instructions or a tax professional.
See the exact date for this filing season on the 1099-NEC and W-2 due date page, add it to your calendar in the tax deadline calendar, or let us handle your contractor paperwork. More free tools: Short-term rental break-even occupancy calculator, Contractor overhead rate per labor hour calculator, Inventory turnover and days of inventory calculator, or see all free tools.
Free
Month-End Close Checklist (PDF)
The five-day close, one page to print. Enter your email and we send a link to confirm it is yours, then the download. We may email you about new toolkits, and every email has an unsubscribe link.
General information, not tax or legal advice. How we write and check our tools.