Payroll
1099-NEC and 1099-MISC Filing Checklist for Small Businesses
Who to send 1099s to, what the dollar thresholds are, when they're due, and how to avoid IRS penalties for late or wrong filings.
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Who Gets a 1099
- 1099-NEC: any non-employee (contractor, freelancer, professional) you paid $600+ during the year for services in the course of your trade or business.
- 1099-MISC: rent ($600+), prizes/awards ($600+), gross proceeds to attorneys ($600+), royalties ($10+), medical and healthcare payments ($600+), and a few other categories.
- Payments to corporations are generally exempt — EXCEPT payments to attorneys (always 1099-NEC) and payments for medical or healthcare services (always 1099-MISC).
- LLCs: depends on tax election. If they're a disregarded entity or partnership, they need 1099s. If they elected S-corp or C-corp, they're treated as corporations and are exempt (except attorneys/medical).
- Form W-9: get one from every contractor BEFORE you pay them. It confirms entity type and TIN.
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