Form 1099-NEC vs 1099-MISC: which one do you need?

Published November 4, 2026 by Jason Nel

If you pay freelancers, contractors or landlords, you may need to report those payments to the IRS on a Form 1099. Two of the most common versions are the 1099-NEC and the 1099-MISC, and they are easy to mix up. The short version: 1099-NEC reports payments for services, and 1099-MISC reports most other kinds of income.

What is a 1099-NEC?

The 1099-NEC (nonemployee compensation) reports money a business paid to someone who is not its employee for work done for the business. Typical examples are fees paid to a freelance designer, a self-employed consultant, a contract bookkeeper or an independent tradesperson. The recipient is usually an individual or a partnership rather than a corporation, with a few exceptions such as attorneys' fees.

What is a 1099-MISC?

The 1099-MISC (miscellaneous information) covers payments that are not nonemployee compensation. These include rent paid for business property, royalties, prizes and awards, medical and health care payments, and some other income. Before 2020, nonemployee compensation was reported in box 7 of the 1099-MISC. The IRS moved it to its own form, the 1099-NEC, so the two forms now do different jobs.

Side by side

Reports: NEC is pay for services by non-employees. MISC is rents, royalties, prizes, medical payments and other income.
Reporting threshold: $600 or more in the year for payments made through 2025, and $2,000 or more for payments made from 2026 onward under the 2025 tax law change (royalties on Form 1099-MISC still start at $10). Confirm the figure in the IRS instructions for the year you are filing.
Deadline to the recipient: January 31 for the 1099-NEC. For the 1099-MISC it is generally January 31 as well, or February 15 for certain boxes.
Deadline to the IRS: January 31 for the 1099-NEC, whether you file on paper or electronically. For the 1099-MISC it is generally February 28 on paper or March 31 electronically.

Deadlines that fall on a weekend or holiday move to the next business day. Always check the current instructions before you file, as thresholds and rules change.

How to decide which one you need

Did you pay someone for services they provided to your business, and are they not your employee? Use the 1099-NEC.
Did you pay rent, royalties, a prize or another non-service payment? Use the 1099-MISC.
Did you pay a payee both kinds of amounts? File one of each form, each reporting only its own type.

Collect a Form W-9 from each contractor before you pay them. It gives you the legal name, address and taxpayer ID you need to complete the 1099.

Filling in a 1099-NEC

The form needs your details as the payer, the recipient's details and TIN, and the total paid in box 1. Box 4 is for any federal income tax you withheld, and boxes 5 to 7 are for state tax information. The 1099-NEC has several copies: Copy A goes to the IRS, Copy 1 to your state tax department if it requires one, Copy B to the recipient, and Copy 2 is for the recipient's state return. You can fill in the 1099-NEC form on screen and the details you type in one copy are repeated on the others.

Copy A is printed in red ink and cannot be filed from a printout of the PDF. File it electronically through the IRS information returns system, or on the official scannable form. The recipient copies can be printed on plain paper or sent as a PDF.

Before you send the recipient’s copy, use Flatten PDF so the filled-in boxes become part of the page and can’t be changed by accident.

Mistakes to avoid

Reporting contractor pay on a 1099-MISC. Use the 1099-NEC.
Skipping the W-9 and then not having the correct name or TIN.
Including payments made by credit card or payment app, which are generally reported by the payment processor on a different form.
Missing the January 31 deadline. Late filing carries penalties that grow the longer you wait.

This guide is general information, not tax advice. If you are unsure which form applies, check the IRS instructions or ask an accountant.