Paid a contractor or freelancer final yr? Then chances are you’ll have to file a 1099-NEC. The excellent news is that submitting on-line is quicker and less complicated than coping with paper kinds—as soon as you recognize the steps.
This information walks you thru all the course of for the 2026 tax yr (filed in early 2027). You will be taught who must file, what info to assemble, how to decide on the best submitting technique, and easy methods to keep away from the penalties that catch so many small companies off guard. No complicated tax jargon, simply clear directions you’ll be able to comply with.
Let’s get your 1099-NEC carried out proper.
What Is a 1099-NEC and Who Must File One?
The 1099-NEC studies “non-employee compensation”—cash you paid to impartial contractors, freelancers, or different service suppliers who aren’t your staff.
For the 2026 tax yr, you typically have to file a 1099-NEC for any contractor you paid $2,000 or extra throughout the yr. This threshold went up beneath the One Massive Lovely Invoice Act, signed on July 4, 2025. In previous years, the edge was $600, so this can be a significant change for a lot of filers.
A number of fast guidelines on who you do not file for:
- W-2 staff. Their wages go on a W-2, not a 1099.
- C-corporations or S-corporations, with restricted exceptions like medical or authorized funds.
- Funds made by bank card or third-party apps (like PayPal or Venmo). These get reported on a 1099-Okay by the cost processor, not by you.
Another rule value realizing: if you happen to file 10 or extra complete info returns in a yr (counting all of your W-2s, 1099s, and 1098s collectively), the IRS requires you to file electronically. For many small companies, on-line submitting is the one choice anyway.
Step 1: Collect Your Data Earlier than You Begin
Speeding right into a submitting portal with lacking particulars is the primary explanation for errors and rejections. Spend a couple of minutes on this guidelines first, and the remaining goes easily.
- Get a accomplished W-9 from each contractor. This manner provides you their authorized identify, deal with, Taxpayer Identification Quantity (TIN), and enterprise kind. Do not file with out one. If a contractor refuses to supply a TIN, you will need to begin backup withholding at 24% and doc the refusal.
- Add up all funds per contractor. Depend each cost you made to that particular person throughout the entire yr. Small or one-off funds nonetheless rely towards the edge.
- Confirm every TIN earlier than you file. A mismatched TIN is the most typical motive companies get an IRS CP2100 discover. Run each by IRS TIN Matching or a supplier that checks it for you in actual time.
- Test your state’s guidelines. Not each state is a part of the Mixed Federal/State Submitting program, so chances are you’ll have to file instantly together with your state too.
Step 2: Verify the 1099-NEC Is the Proper Kind
The shape you employ relies on the kind of cost, not the quantity.
Use the 1099-NEC once you paid an impartial contractor or freelancer for his or her companies. Use the 1099-MISC for issues like lease, legal professional charges, or prizes.
This is a typical mix-up: if you happen to paid a contractor for companies and reimbursed them for bills, these are dealt with individually. The service funds normally go on a 1099-NEC, whereas reimbursements typically do not get reported in any respect. When unsure, examine the IRS Directions for Types 1099-MISC and 1099-NEC.
Step 3: Select How You will File On-line
You’ve got two major paths for submitting your 1099-NEC on-line.
Choice 1: The IRS IRIS Portal
The IRS is shifting filers from its previous FIRE system to the newer IRIS platform. The IRIS Taxpayer Portal helps you to eFile 1099 kinds instantly with the IRS without cost.
IRIS works greatest if you happen to’re submitting fewer than 10 returns. But it surely comes with some limits: principally handbook knowledge entry, no built-in TIN verification, no state submitting assist, and no print-and-mail service for recipient copies. You will additionally want to use for a Transmitter Management Code (TCC) from the IRS earlier than you’ll be able to file.
Choice 2: A Third-Get together eFile Supplier
Platforms like eFileMyForms deal with the heavy lifting for you. You get bulk CSV add, real-time TIN verification, automated recipient copy supply (by mail or safe e-mail), state submitting assist, and audit-ready data.
This is how the 2 evaluate:
| Characteristic | IRIS Portal | eFileMyForms |
| Bulk CSV add | Restricted | Sure |
| TIN verification | No | Sure |
| Recipient copy supply | No | Sure |
| State submitting assist | Restricted | Sure |
| Finest for | Beneath 10 returns | 10+ returns or multi-state |
Select IRIS if you are submitting only a handful of kinds and do not thoughts dealing with recipient copies your self. Select a supplier like eFileMyForms if you file 10 or extra returns, need assistance mailing copies, or have state submitting obligations. There isn’t any subscription, so that you solely pay for what you file.
Step 4: Enter, Validate, and Submit Your Types
Whether or not you employ IRIS or a supplier, the steps look about the identical:
- Enter or add your knowledge. Embrace every contractor’s identify, deal with, TIN, the cost quantity, the shape kind, and the tax yr.
- Run the validation checks. Most platforms flag lacking TINs, formatting errors, and duplicate entries earlier than you file.
- Overview the abstract. Double-check the full variety of kinds, the greenback quantities, and any state submitting picks.
- Undergo the IRS. Your supplier sends the kinds and provides you a affirmation. Put it aside as your submitting report.
- Observe acceptance. Most platforms present IRS acceptance inside 24 to 48 hours. If something is rejected, repair it and resubmit shortly.
Step 5: Ship a Copy to Your Contractor
Submitting with the IRS is just half the job. You even have to offer every contractor their copy of the 1099-NEC by the deadline, both on paper or electronically. Paper copies have to be postmarked by the recipient due date.
2026 Tax Yr Deadlines and Penalties
For the 1099-NEC, each the recipient copy and the IRS eFile are due on January 31, 2027. Since that date falls on a Sunday, the deadline seemingly strikes to February 1, 2027. (When a deadline lands on a weekend or vacation, the IRS bumps it to the subsequent enterprise day.)
Lacking the deadline will get costly quick. Penalties climb in tiers:
- $60 per kind if you happen to repair it inside 30 days.
- $130 per kind if you happen to repair it between 31 days and August 1.
- $340 per kind if you happen to file after August 1 or by no means file.
- $680 per kind for intentional disregard, with no cap.
The takeaway: submitting late at all times beats not submitting in any respect.
Get Your 1099-NEC Filed With out the Stress
Submitting a 1099-NEC on-line actually comes down to 5 steps: collect your information, affirm the shape, decide your technique, undergo the IRS, and ship copies to your contractors. The companies that sail by tax season with out penalties are those that begin early.
Start accumulating W-9s earlier than the yr ends, confirm your TINs forward of January, and decide a submitting technique that matches what number of kinds you’ve.
eFileMyForms, powered by Sovos, helps you to add your knowledge, run validation checks, mail recipient copies, and undergo the IRS—all from one place, with no subscription required. Begin submitting your 1099s with eFileMyForms.
Continuously Requested Questions
Do I have to file a 1099-NEC for each contractor I paid?
Provided that you paid them at or above the edge. For the 2026 tax yr, the 1099-NEC threshold is $2,000. For those who paid a contractor lower than that for the yr, you typically needn’t file one for them.
What if a contractor will not give me their TIN?
If a contractor refuses to supply a Taxpayer Identification Quantity, you will need to begin backup withholding immediately at 24% and doc the refusal. You must nonetheless file the 1099-NEC for any reportable funds utilizing the knowledge you’ve.
How a lot does it value to file a 1099-NEC on-line?
It relies on your technique. The IRS IRIS portal is free however requires handbook work and a TCC. Third-party suppliers like eFileMyForms use pay-as-you-go pricing with no subscription, so that you solely pay for the kinds you file plus any extras like mailing or TIN matching.
Can I nonetheless use the IRS FIRE system to file?
The IRS is phasing out FIRE and shifting to the IRIS platform. For the 2027 submitting season, plan to make use of IRIS or a third-party eFile supplier as an alternative.
Do I’ve to file with my state too?
It relies on the place you and your contractors are situated. Some states participate within the Mixed Federal/State Submitting program, which might ship your kinds to the state for you. Others require direct submitting. At all times examine your state’s necessities earlier than assuming the federal submitting covers each.
