Who do I need to send a 1099 to?
The short answer
If your business paid $2,000 or more during 2026 to a person who did work or services for you without being your employee — a subcontractor — you generally must send them Form 1099-NEC. The deadline is Monday, February 1, 2027, both to give it to the person and to file it with the IRS. Note: the $2,000 threshold applies to payments made in 2026; for payments in 2025 and earlier, the threshold was $600.
In plain language: three words to know
- Subcontractor: a person who works for your business by project or by job but is NOT your employee. You don't withhold taxes or pay Social Security for them.
- Form W-9: the form the subcontractor completes with their name, address, and tax ID number (Social Security or ITIN) before you pay them. Without it, you don't have the information for the 1099.
- Form 1099-NEC: the form you use to report to the IRS how much you paid each subcontractor during the year. It's like a W-2, but for people who aren't employees.
Who do you NOT send a 1099 to?
- Your employees — they receive a W-2, not a 1099.
- Generally, corporations (with exceptions, such as payments to attorneys).
- Anyone you paid less than the threshold for the year ($2,000 for 2026 payments).
- For merchandise or products you bought — the 1099 is for services.
- Rent for an office or space is reported on a different form (1099-MISC), not the NEC.
The step that saves you the headache
Get the W-9 before the first payment, not in January when you can't find the subcontractor anymore. And track how much you pay each person during the year: if the total reaches the threshold, the 1099 is required. We file your 1099s directly through the IRS's IRIS system.
Frequently asked questions
What happens if I don't send a 1099 on time?
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There are penalties for each form filed late or not filed, and the person can also have problems filing their own taxes. The 1099-NEC deadline is earlier than other forms: February 1, 2027 for 2026 payments.
Is the threshold $600 or $2,000?
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It depends on the year of the payment: $600 for payments made in 2025 and earlier; $2,000 for payments made in 2026. It's the threshold per person, per year: all payments you made to that subcontractor during the year are added together.
What if the subcontractor doesn't have a Social Security number?
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It doesn't matter: you report with their ITIN. The W-9 accepts an ITIN, and the 1099 is issued the same way.
What's the difference between a subcontractor and an employee?
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Simple: if you decide their schedule and how they do the work, they're your employee and get a W-2. If they work on their own, by project, and also work for others, they're a subcontractor and get a 1099. Getting this wrong brings penalties, so it's better to ask.
What if I paid by Zelle, Cash App, or card?
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If you paid by card or with apps like Venmo or Cash App, the app already reports it to the IRS — don't send another 1099 for that payment, that would duplicate it. But if you paid by Zelle, in cash, by check, or by transfer from your bank, the 1099 has to come from you. If you're not sure, ask us.
What is the W-9?
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It's a short form that a person who will work for you as a subcontractor fills out before you pay them. They put their legal name, their address, and their Social Security number or ITIN. You don't send it to the IRS: you keep it in your files, because that information is what you use to prepare their 1099 at the end of the year. Without the W-9, you don't have what you need to report the payment. Download it free here: Official IRS Form W-9 (PDF)
Not sure who you need to send a 1099 to? Message us on WhatsApp at 857-919-5069 with your subcontractor list and we'll review it with you before the deadline.