OVERVIEW
The 1099 form is a series of documents the Internal Revenue Service (IRS) refers to as "information returns." There are a number of different 1099 forms that report various types of payments you may receive throughout the year other than what a business might pay you.
For information on the third coronavirus relief package, please visit our “American Rescue Plan: What Does it Mean for You and a Third Stimulus Check” blog post.
|
Key Takeaways • Form 1099 is a collection of forms used to report payments that typically aren't from an employer. • There are a variety of incomes reported on a 1099 form, including independent contractor income and payments like gambling winnings, rents or royalties, gains and losses in brokerage accounts, dividend and interest payments, and more. • If you work as an independent contractor or freelancer, you will often have income reported on a 1099 form. • You should receive most of your 1099 forms by January 31 each year to report the preceding year’s payments to you. |
What is an IRS 1099 Form?
The IRS 1099 Form is a collection of tax forms documenting different types of payments made by an individual or a business that typically isn’t your employer. The payer fills out the form with the appropriate details and sends copies to you and the IRS, reporting payments made during the tax year. In some instances, a copy must also be sent to your state taxing authority. The payer is responsible for filling out the appropriate 1099 tax form and sending it to you. Such payments can be for rental income, earnings working as a freelancer or independent contractor, a tax refund received from your state or locality, gambling winnings, and more. Most 1099 forms are required to be provided by January 31, but in certain instances, this date is February 15.
Examples of when you might get a 1099 Form
Some common examples when you might receive a 1099 include:
- If you earned $600 or more in nonemployee compensation from a person or business who isn’t typically your employer, you should receive a Form 1099-NEC
- If you earned $600 or more in rent or royalty payments, you should receive Form 1099-MISC
- If you received a state or local tax refund during the previous year, you should expect to receive Form 1099-G
Likewise, if you paid a freelancer, independent contractor or other nonemployee $600 or more during the year related to your trade or business, you likely should send them a Form 1099-NEC.
Who sends 1099 forms?
Several types of 1099 forms exist to document payments made between an individual or business and another party. Because 1099 forms record payments, many people can receive various 1099 forms for different reasons.
One of the most popular 1099 forms is the 1099-NEC for Non-Employee Compensation payments. For example, if you’re an independent contractor or freelancer, you may receive a Form 1099-NEC documenting payments made to you throughout the year from a particular payer.
Non-Employee Compensation payments below $600 don’t require filing the 1099-NEC, though the payer may still choose to do so.
TurboTax Tip: The 1099-NEC form should include payments made to you if they are $600 or more from a single source. That is the threshold requiring a payer to file a Form 1099-NEC.
When should you expect to send or receive 1099s?
There are different due dates for different types of 1099 forms. For example, Form 1099-NEC, which is typically used to report payments to you if you're an independent contractor or freelancer, is due to you by January 31st. If January 31st isn't a business day, then the due date moves to the next business day.
If you’re the one sending 1099 forms:
- Most 1099 forms are due to the recipient by January 31st.
- If you’re mailing a paper form to the IRS, you typically must send the 1099 by February 28 (postmarked by that date).
- If you're using tax software like TurboTax to send the forms to the IRS, we'll import the information for the form for you, and you have until March 31 to e-file it, which means e-filing a return will give you more time to prepare the form than mailing a paper form.
- Forms 1099-NEC are due to recipients and to the IRS by January 31 regardless of whether they are electronically or paper filed.
Payers must send you these forms early in the tax season to allow you time to prepare your tax return and allow the IRS to have evidence of how much income you earned during the tax year.
Despite the early due dates for sending these forms as a payer, you won’t need to file your own tax return until the tax filing deadline.
The early due dates to send 1099s to the IRS helps them detect refund fraud more easily by verifying income that individuals report on their tax returns. Most 1099s need to be filed with the IRS by February 28th if sent by mail or March 31st if e-filed.
See more on the types of 1099 forms below.
The Two Most Common 1099 Forms: 1099-NEC and the 1099-MISC
| 1099-NEC: Nonemployee Compensation
What: For reporting nonemployee compensation such as income earned as an independent contractor, freelancer, or self-employed individual. |
Due Date to Recipient: February 1
Due Date to IRS: February 1 Example: Worked as a rideshare driver, food delivery person, freelance writer, or other gig worker or independent contractor. |
| 1099-MISC: Miscellaneous Information
What: For payments you receive like rent, royalties, prizes and awards, substitute payments in lieu of dividends, medical and health care payments, crop insurance proceeds, and other items. |
Due Date to Recipient: February 1 (or February 16 if substitute dividends and tax-exempt interest payments reportable by brokers or gross proceeds paid to attorneys)
Due Date to IRS: February 28 (or March 31 if filed electronically) Example: Received rent payments for property you lease |
1099-NEC vs. 1099-MISC
What is the difference between the 1099-NEC and 1099-MISC forms? Prior to the 2020 tax year, as a business owner who hired contractors, you dealt primarily with Form-1099 MISC for reporting nonemployee compensation. Starting in 2020, the IRS chose to reintroduce the 1099-NEC Form as the new way to report self-employment income instead of using Form 1099-MISC. This was done in part to help clarify that there is a separate filing deadline for nonemployee compensation than the deadlines for other payments that use Form 1099-MISC.
Nonemployee compensation can include any compensation received for any services performed while not being treated as an employee. In contrast, as an employee, your compensation is typically reported on a Form W-2.
Now, Form 1099-NEC reports nonemployee compensation but the 1099-MISC still exists to report other types of miscellaneous income.
Other Types of 1099 Forms
| 1099-A: Acquisition or Abandonment of Secured Property
What: If you had property foreclosed on during the tax year, you may receive this form from your mortgage lender if it canceled some or all of your mortgage, you forfeited ownership or had your property sold in a short sale. |
Due Date to Recipient (Borrower): January 31
Due Date to IRS: For mailed paper returns, February 28. March 31 if e-filed online with tax software. Example: Your lender foreclosed on your house, cancelling your mortgage. |
| 1099-B: Proceeds from Broker and Barter Exchange Transactions
What: For reporting sales of stocks, bonds, derivatives or other securities during the tax year through one or several brokers. |
Due Date to Recipient: February 15 (March 15 for reporting by trustees and middlemen of widely held fixed investment trusts (WHFITs))
Due Date to IRS: For mailed paper returns, February 28. March 31 if e-filed online with tax software. Example: You sold stocks in a brokerage account. |
| 1099-C: Cancellation of Debt
What: For entering into an agreement with a lender negotiating a debt cancellation with them. |
Due Date to Recipient: January 31
Due Date to IRS: For mailed paper returns, February 28. March 31 if e-filed online with tax software. Example: Entered into an agreement with your lender to cancel all or part of your mortgage. |
| 1099-DIV: Dividends and Distributions
What: For receipt of dividends and/or certain distributions typically from investments |
Due Date to Recipient: January 31
Due Date to IRS: For mailed paper returns, February 28. March 31 if filed online with tax software. Example: Dividends from stocks |
| 1099-G: Certain Government Payments
What: For reporting unemployment compensation, as well as any state or local income tax refunds during the year. |
Due Date to Recipient: January 31
Due Date to IRS: For mailed paper returns, February 28. March 31 if e-filed online with tax software. Example: CA state tax refund |
| 1099-INT: Interest Income
What: For receipt of interest payments, and you may or may not need to pay income tax on this interest. You may still need to include the information from this form on your tax return. |
Due Date to Recipient: January 31
Due Date to IRS: For mailed paper returns, February 28. March 31 if filed online with tax software. Example: Savings account interest |
| 1099-K: Payment Card and Third Party Network Transactions
What: For reporting credit card payments and third-party payment processing received over the internet if you run a business as an online retailer, ecommerce store or other online business. For tax years prior to 2022, you should receive this form if your annual credit card processing activity exceeds $20,000 and you had more than 200 individual transactions. Beginning in 2022, the thresholds are changing to more than $600 per year and no minimum number of individual transactions. |
Due Date to Recipient: January 31
Due Date to IRS: For mailed paper returns, February 28. March 31 if e-filed online with tax software. Example: You run an ecommerce website which earned over $600 in 2022 through individual credit card transactions. |
| 1099-LTC: Long-Term Care and Accelerated Death Benefits
What: For reporting payments under a long-term care insurance contract and accelerated death benefits paid under a life insurance contract or by a viatical settlement provider. |
Due Date to Recipient: January 31
Due Date to IRS: For mailed paper returns, February 28. March 31 if e-filed online with tax software. Example: Received payments from a long-term care insurance policy. |
| 1099-OID: Original Issue Discount
What: When you hold bonds or certificates of deposit (CDs) that were issued at an amount less than the face value, you typically recognize as income a portion of this discount each year until the bond is redeemed or it reaches its full matured value. Form 1099-OID reports this annual amount. |
Due Date to Recipient: January 31
Due Date to IRS: For mailed paper returns, February 28. March 31 if e-filed online with tax software. Example: You purchased bond investments through a brokerage and paid less than face value for them. |
| 1099-Q: Payments from Qualified Education Programs (Under Sections 529 and 530)
What: This form reports distributions received from qualified tuition programs and Coverdell Education Savings Accounts (ESAs). |
Due Date to Recipient: January 31
Due Date to IRS: For mailed paper returns, February 28. March 31 if e-filed online with tax software. Example: You received a distribution from a 529 savings plan or a Coverdell ESA. |
| 1099-QA: Distributions from ABLE Accounts
What: This form provides information related to distributions from Achieving a Better Life Experience (ABLE) accounts |
Due Date to Recipient: January 31
Due Date to IRS: For mailed paper returns, February 28. March 31 if e-filed online with tax software. Example: You received a distribution from an ABLE account. |
| 1099-R: Distributions from Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, Etc.
What: For receiving distributions of retirement benefits such as pensions and annuities of $10 or more. |
Due Date to Recipient: January 31
Due Date to IRS: For mailed paper returns, February 28. March 31 if e-filed online with tax software. Example: You received a distribution from your pension plan. |
| 1099-S: Proceeds from Real Estate Transactions
What: If you sold or exchanged real estate during the year and received gross proceeds from the sale or exchange or received certain royalty payments. |
Due Date to Recipient: February 15
Due Date to IRS: For mailed paper returns, February 28. March 31 if e-filed online with tax software. Example: You sold your home. |
| 1099-SA: Distributions from an HSA, Archer MSA, or Medicare Advantage MSA
What: If you used funds from a tax-advantaged health care savings plan, the institution administering your plan will report distributions through Form 1099-SA. |
Due Date to Recipient: January 31
Due Date to IRS: For mailed paper returns, February 28. March 31 if e-filed online with tax software. Example: Received distributions from your health savings account. |
| SSA-1099: Social Security Benefit Statement
What: Reports the amount of benefits paid and repaid, Medicare premiums and other amounts withheld, and federal income taxes withheld for the year from Social Security Benefits. |
Due Date to Recipient: January 31
Due Date to IRS: For mailed paper returns, February 28. March 31 if e-filed online with tax software. Example: Received Social Security benefits. |
What to do if you don’t get all of your 1099 forms
Even if you don’t have the appropriate forms, you’re still responsible for paying the taxes you owe. If you didn’t receive a 1099, you need to report the income received on your tax return in order to avoid a bill from the IRS for owed taxes and possible penalties.
If you haven’t received all of your 1099s by the January 31st or February 15th deadlines, contact the person or business responsible for sending you the 1099. Request that they send you a copy of your 1099 so you may file your tax return on time.
To understand more about tax deductions, visit our Self-Employed Tax Deduction Calculator for Contractors.
With TurboTax Live Full Service Self-Employed, work with a tax expert who understands independent contractors and freelancers. Your tax expert will do your taxes for you and search 500 deductions and credits so you don’t miss a thing. Backed by our Full Service Guarantee. You can also file your self-employed taxes on your own with TurboTax Self-Employed. We’ll find every industry-specific deduction you qualify for and get you every dollar you deserve.
