Form 1099-NEC: Nonemployee Compensation

VOIDWhat it is forPaper filing only. A checked VOID box tells IRS scanning equipment to skip that form on the sheet and go to the next one.Watch forNever check it on a paper correction. The IRS skips a voided form, so the correction is not entered into IRS records.How corrections workCORRECTEDWhat it is forMarks a return that corrects a Form 1099-NEC you already sent to the IRS.Watch forThe steps depend on the error and how you filed: part H of Pub. 1099 for paper, Pub. 5717 for the IRIS Taxpayer Portal, Pub. 5718 for IRIS Application to Application.Type 1 vs Type 2 correctionsCalendar yearWhat goes hereThe four-digit calendar year the payments were made, not the year you file. Payments made in 2026 go on a form marked 2026, filed by January 31, 2027.Watch forThe December 2026 revision is a continuous-use form: use it for 2026 and later years until the IRS replaces it, and never for years before 2026.The 2027 calendarPayer's nameThe filer's legal name as tied to its EIN on IRS records, on the first line; a trade name goes on the second. Filed under the wrong name the whole batch can fail to post.Check the filer blockPayer's street addressStreet or P.O. box of the filer, where the recipient can write about the form. Not matched against IRS records.Payer's room or suiteSecond address line, optional.Payer's city or townCity of the filer's address. A foreign filer gives the city and leaves the state blank.Payer's telephone numberRequired: a number the recipient can call about the form, with area code. The recipient copy must carry it.Payer's state or provinceTwo-letter state code for a U.S. address; the province for a foreign one.Payer's countryWhat goes hereThe filer's country. Use the IRS country code list at IRS.gov/CountryCodes.Payer's ZIP or postal codeFive or nine digits for a U.S. address; the foreign postal code otherwise.Payer's TINThe EIN the returns are filed under; it must match the filer name on the first line. A sole proprietor may use an SSN, with the owner's name first.Check the filer blockRecipient's TINWhat goes hereThe recipient's SSN, ITIN, ATIN or EIN, with hyphens: XXX-XX-XXXX for an SSN, ITIN or ATIN, XX-XXXXXXX for an EIN. Make sure the type of number is the right one.Watch forYou may truncate it on the recipient's copy, never on the copy filed with the IRS. An attorney must give you a TIN but need not certify it; without one, you must backup withhold.Match it before you fileRecipient's nameThe name the IRS has for this TIN: an individual's own name for an SSN, the legal name for an EIN; a DBA goes on the second line. This is what TIN matching compares.Which name goes firstRecipient's street addressWhere the recipient copy is mailed. From the W-9 line 5; the IRS does not match it, but an undeliverable copy is a furnishing failure.Recipient's apartment or suiteSecond address line, optional. Keep it on its own line rather than appended to the street.Recipient's city or townCity of the mailing address, from the W-9 line 6.Recipient's state or provinceTwo-letter state code; it also drives which state copies are needed when there is no withholding.State filing requirementsRecipient's countryWhat goes hereThe recipient's country. Use the IRS country code list at IRS.gov/CountryCodes.Watch forPayments to nonresident alien entertainers go on Form 1042-S, not on this form.Foreign payeesRecipient's ZIP or postal codeFive or nine digits for a U.S. address, or the foreign postal code.Account numberWhat goes hereYour own account number for this recipient.Required whenYou have more than one account for the recipient and file more than one Form 1099-NEC for them. The number tells the returns apart.Box 2nd-tin: D TIN not.Check it whenThe IRS has notified you twice within 3 calendar years that this payee gave you an incorrect TIN. The IRS then sends you no further notices about this account.Watch forDo not check it if both notices came in the same year, or if they relate to returns for the same year. For the two-notices rule those count as one notice, so no second B Notice is due.Open this box on the IRIS field mapBox 1a: Nonemployee compensationWhat goes herePay for services by someone who is not your employee: fees, commissions, prizes and awards for services, attorneys' fees, directors' fees, and gross oil and gas working interest payments.Threshold$2,000 or more to the payee in the year, corporations included for attorneys' fees.Watch forGross proceeds paid to an attorney go on Form 1099-MISC box 10. Pay not subject to self-employment tax goes in Form 1099-MISC box 3; interest on Form 1099-INT.Click to open the row in the box tableBox 1b: Cash tipsWhat goes hereThe part of box 1a that is cash tips. Cash tips include tips paid in cash or charged by customers.Watch forNew for 2026 under P.L. 119-21 section 70201. Box 1b is a breakout of box 1a, not an extra amount, and box 1c must say which occupation the tips came from.Click to open the row in the box tableBox 1c: Treasury Tipped Occupation CodeWhat goes hereThe Treasury Tipped Occupation Code for the payee's tipped work, up to two codes. Codes are listed at IRS.gov/TTOC.Watch forTips earned in more than two occupations: enter any two. If any tips came from an occupation that does not qualify, one of the codes must be 000.Click to open the row in the box tableBox 1d: Overtime compensationWhat goes hereThe part of box 1a that is qualified overtime compensation: pay required by section 7 of the Fair Labor Standards Act above the individual's regular rate.Watch forOnly the premium counts: the "half" of time-and-a-half, not the whole overtime hour. New for 2026 under P.L. 119-21 section 70202.Click to open the row in the box tableBox 2: Direct sales of $5,000 or moreWhat goes hereAn X when you sold this person $5,000 or more of consumer products for resale anywhere other than a permanent retail store, on a buy-sell, deposit-commission or other commission basis. No dollar amount.Watch forReport the sales here or in Form 1099-MISC box 7, never both. Reporting them here makes the return due to the IRS by January 31. The recipient's copy can be a letter showing the sales with any commissions, prizes or awards.Click to open the row in the box tableBox 3: Excess golden parachute paymentsWhat goes hereExcess golden parachute payments: the amount over the base amount, which is the individual's average annual compensation includible in gross income over the most recent 5 tax years.Watch forThese no longer go on Form 1099-MISC. For an independent contractor, box 1a shows the total compensation including any golden parachute payment. Regulations section 1.280G-1, Q/A-38 to 44, show how to figure the excess.Click to open the row in the box tableBox 4: Federal income tax withheldWhat goes hereBackup withholding, for example from a payee who did not give you a TIN, on payments reported in box 1a.ThresholdAny amount. File a Form 1099-NEC for every person you backup withheld from, however small the payment.Watch forPub. 1099 part N gives the rate. The year's total backup withholding is reported on Form 945.Click to open the row in the box tableBox 5: State tax withheldWhat goes hereState income tax withheld from this payment, if any. Up to two states, one per line.Watch forBoxes 5 to 7 are for your convenience and the IRS does not need them. States that take a paper copy get Copy 1; check each state's own filing rules.Click to open the row in the box tableBox 6: State/Payer's state no.What goes hereThe state's abbreviation and the payer's state identification number, the number that state assigned you.Watch forKeep each state's figures on its own line, separated by the dash line.Click to open the row in the box tableBox 7: State incomeWhat goes hereThe amount of the payment that belongs to that state. Optional.Watch forGive the recipient Copy 2 for the state income tax return.Click to open the row in the box table

Hover over a box for what goes in it; click to open its row in the table below. On a touch screen, tap the box to jump to the row.

Who must file Form 1099-NEC

File Form 1099-NEC for each person to whom you paid, in the course of your trade or business, $2,000 or more during the year for services performed by someone who is not your employee (including parts and materials), or as attorneys' fees. Nonprofits, government agencies, trusts of qualified plans and exempt cooperatives count as trades or businesses for this purpose. Personal payments are never reportable.

You must also file a 1099-NEC for anyone from whom you withheld federal income tax under the backup withholding rules, regardless of amount. That is the rule that turns a $300 vendor with no W-9 into a required return.

Directors' fees, commissions to non-employee salespeople, prizes and awards for services, fees to lottery sales agents, golden parachute payments to non-employees and excess golden parachute payments (box 3, since 2025) all go here. Payments by a federal executive agency for services are reportable even to corporations.

Threshold: $2,000, per payee per year, for payments made after 2025 (previously $600); indexed for inflation from 2027.

What is reported, box by box

Box titles follow the current revision of the form. The IRS reads the payer and recipient name, TIN, address, account number and the money boxes; the state boxes are for the state copy only.

Payments that are not reported on Form 1099-NEC

• Payments to a corporation, including an LLC taxed as a C or S corporation, except attorneys' fees and payments by federal executive agencies for services.
• Payments for merchandise, freight, storage, telephone and similar items.
• Payments made with a credit card, debit card or through a third-party network: the payment settlement entity reports them on Form 1099-K, not you.
• Wages, bonuses and prizes to employees (Form W-2); scholarships; canceled debt (1099-C); rent (1099-MISC box 1).
• Payments to tax-exempt organizations, governments, IRAs and similar trusts; difficulty-of-care payments within the section 131 limits.

Due dates and extensions

No automatic extension. Form 8809 grants an extension for the 1099-NEC (and W-2) only on a showing of one of the listed hardships, and it must be filed by January 31. Recipient statements can be extended 30 days on Form 15397, online or by fax only. 10 or more information returns of any type in aggregate must be e-filed (T.D. 9972); IRIS is the only IRS intake system from filing season 2027, FIRE having been retired. A payer who e-files the originals must e-file the corrections.

For 2026 forms filed in 2027: January 31 falls on a Sunday, so that deadline moves to Monday, February 1, 2027; February 28 also falls on a Sunday, so the paper deadline moves to Monday, March 1, 2027. March 31 (electronic) and March 15 are weekdays. February 28 does not become February 29 in a leap year. The compliance calendar has every date with the weekend shifts applied.

Backup withholding and TIN matching

Nonemployee compensation is a section 6041A reportable payment, so backup withholding at 24% applies the moment a payee fails to furnish a TIN, and again when the IRS tells you (on a CP2100) that the name/TIN pair is wrong. There is no awaiting-TIN grace: the 60-day exemption is for interest and dividends only, so a contractor who "applied for" an EIN is withheld on from the first payment. Report the tax in box 4 and on Form 945; the EIN on the 945 must be the EIN on the 1099-NECs.

1099-NEC payers may use the IRS TIN Matching program, and should: the form has the highest mismatch rate of any information return because its payees are individuals and single-member LLCs who put the business name on line 1.

Name and TIN errors on this form

Every information return is matched by the IRS on the first four characters of the payee's name (the name control) against the TIN. A mismatch produces a CP2100 line the following autumn and, unless the solicitation record is in order, a 972CG penalty the year after: $340 per return for 2026 forms filed in 2027 that are late or wrong, $690 for intentional disregard, with annual maximums of $4,191,500 ($1,397,000 for small filers) under Rev. Proc. 2025-32. The errors that recur on Form 1099-NEC:

• Sole proprietors and disregarded LLCs. The individual's name goes on the first name line and the business or LLC name on the second. A 1099-NEC filed as "Riverside Landscaping LLC" with the owner's SSN mismatches every time. See which name goes on the W-9.
• Attorneys. An attorney must supply a TIN even as a corporation, and you must backup withhold if they refuse; the corporate exception does not apply to legal services.
• Deceased contractors. Payments after death go on 1099-MISC box 3 to the estate or beneficiary with that person's TIN, not on the NEC under the decedent's SSN.
• Second TIN notice box. Check it when the IRS has notified you twice in three years about the same payee; the IRS then stops sending notices for that account. Two notices in the same year, or for the same tax year, count as one.
• Same TIN, different payer. A contractor paid through both your operating company and a subsidiary needs a return from each EIN, each above its own $2,000.

The name control calculator shows what the IRS will derive from a name line, and the CP2100 guide covers what to do when the notice arrives.

Recipient statements and substitutes

The recipient statement for Form 1099-NEC need not be a copy of the official form: a substitute may be combined with other account statements or reports, provided every required item is numbered and titled as on the official form, the tax year, form number and form name appear together, the recipient instructions are included, and, for the forms Pub 1099 lists, a telephone number with direct access to someone who can answer questions is shown. Publication 1179 (Rev. Proc. 2026-18) has the specifications; logos, slogans and advertising are not permitted on the statement itself. Statements may be furnished electronically only to a recipient who has affirmatively consented in a way that shows they can access the format, after the disclosures in Pub 1099 part M, and must stay posted through October 15. Copy B may show a truncated TIN (xxx-xx-1234); the IRS copy never may. The consent rules for furnishing statements electronically are under review: Notice 2026-4 asked for comments (due May 23, 2026) on whether the broker rules, and then the rules for every other payee statement, should change.

Corrections and state copies

A wrong amount, code or checkbox is a Type 1 correction: one corrected return with the CORRECTED box checked. The wrong form type is a Type 2 correction: a zeroed-out copy of the original plus a new original, in that order. A wrong or missing payee TIN or name is also Type 2 on paper, but IRIS corrects it in one step on the original record (Publication 5717). Publication 1099 also says you are not required to file a correction for a missing or incorrect TIN if you meet the reasonable-cause standard, only to use the right TIN on the next return, although the IRS encourages the correction. Details and the paper error charts are on the 1099 corrections page.

Form 1099-NEC is a Combined Federal/State Filing program form: e-file it with the CF/SF election and the IRS forwards it to participating states. Whether that satisfies a given state, or the state wants a direct filing with its own transmittal, is on each state pages.

In the Internal Revenue Bulletin

Guidance published in the weekly Bulletin that bears on this form, 2024 to date; what each document does, not its text.

• The separate reporting of cash tips, the occupation code and overtime compensation was added by the 2025 tax law for tax years beginning after December 31, 2024, so it technically applied to 2025 payments before the forms had boxes for it. Notice 2025-62 waives the 6721 and 6722 penalties for leaving those items off tax year 2025 returns and statements, provided the return is otherwise complete and correct; the 2026 forms carry the boxes and no relief has been announced for 2026.
• The occupation codes are the Treasury Tipped Occupation Codes (TTOC), a three-digit code per occupation grouped by hundreds (100s beverage and food service, 200s entertainment and events, and so on), proposed in REG-110032-25, which lists the occupations that customarily and regularly received tips on or before December 31, 2024, with descriptions, examples and the related SOC codes. Notice 2025-69 is the payee-side guidance on claiming the tips and overtime deductions from the statements.
• The $2,000 threshold comes from the 2025 tax law; REG-113229-25 proposes to write it into the 6041, 6041A and backup withholding regulations (and to index it after 2026), applying to payments made on or after January 1, 2026.

Questions people ask about Form 1099-NEC

Other federal forms

1042-S · 1097-BTC · 1098 · 1098-C · 1098-E · 1098-F · 1098-Q · 1098-T · 1098-VLI · 1099-A · 1099-B · 1099-C · 1099-CAP · 1099-DIV · 1099-G · 1099-INT · 1099-K · 1099-LPS · 1099-LS · 1099-LTC · 1099-MISC · 1099-OID · 1099-PATR · 1099-Q · 1099-QA · 1099-R · 1099-S · 1099-SA · 1099-SB · 3921 · 3922 · 5498 · 5498-ESA · 5498-QA · 5498-SA · 5498-TA · W-2G · 1099-DA · Comparison table

Sources: IRS Publication 1099 (2026), General Instructions for Certain Information Returns, which replaced the separate General Instructions starting with tax year 2026; Instructions for Forms 1099-MISC and 1099-NEC (Rev. December 2026); Pub 1099 (2026) Guide to Information Returns; IRC 6041AIRC 6041AInternal Revenue Code, Cornell LII, 3406; P.L. 119-21 sections 70201, 70202 and 70433; Internal Revenue Bulletin: Notice 2025-62; REG-110032-25; REG-113229-25. Threshold amounts are indexed for inflation from calendar year 2027; check IRS.gov/InflationAdjustment for the current year.

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