Last updated on April 11th, 2024 at 02:29 pm
Reviewed by Joshua Ott, M.P.Acy
It’s important to know which IRS forms you need to produce or receive when filing your taxes. If you’re a regular salaried employee, you most likely have federal and state taxes taken from each paycheck. And if you’re an employer with salaried employees, you likely have a process where taxes are taken out of your worker’s checks each week, too.
One of the most commonly used IRS forms is the 1099. In this guide, we’ll cover what 1099 forms are, the different types of 1099 forms, and how to use them.
What is the purpose of a 1099 form?
A 1099 form is a group of forms the IRS uses for payers and payees to document payments. Typically, taxes aren’t taken out of payments made by a person or entity that are recorded and reported using one of the 1099 forms.
What goes on a 1099-misc form?
The 1099-MISC form is used for payments other than when you are being paid for tasks completed in your trade or discipline. For example, you would not use a 1099-MISC to pay extra summer help at your landscaping company. Nor would you receive a 1099-MISC for any type of freelancing, contract, or part-time work.
Here are some examples of when a 1099-MISC form is required:
- If you pay or receive at least $10 in royalties or broker payments instead of dividends or tax-exempt interest.
- If you pay or receive at least $600 in:
- Prizes and awards
- Other income payments
- Medical and health care payments
- Crop insurance proceeds.
- Cash payments for fish (or other aquatic life) you purchase from anyone engaged in the trade or business of catching fish
- Generally, the cash paid from a notional principal contract to an individual, partnership, or estate
- Payments to an attorney
- Any fishing boat proceeds
It’s the responsibility of the payer to create a 1099 form for each person who has received money for any of the reasons listed above.
The payer sends the 1099s to both the person who received the money and to the IRS.
What do I do with a 1099?
If you’ve always been a salaried W-2 employee, a 1099 might be a bit confusing. But don’t worry — here’s what to do if you receive a 1099 from the previous year.
Where do I report the information included on a 1099 form?
When you file your taxes using the IRS 1040 tax form, you’ll find different sections where you can report the income listed on your 1099 form.
Here are two examples:
- If you’ve worked in your trade or discipline and received an IRS form 1099-NEC, you’ll use the amount in Box 1 on your form(s) to report your self-employment, contractor, or freelance income. Instead of putting this information directly on Form 1040, you’ll report it on Schedule C—a form for reporting income from self-employment.
- If you’ve received payments for any of the reasons listed above, you’ll typically report this income on Form 1040, Line 21, as Other Income.
When will I receive my 1099?
You should receive any 1099s by January 31st. Like with any other IRS forms, laws, and regulations govern the processing, sending, and receiving of 1099s.
- If you haven’t received an expected 1099 within a few days after January 31st, contact the payer.
- If you still haven’t received a 1099 form by February 15, call the IRS for help at 1-800- 829-1040.
Different types of 1099s
There are several versions of IRS Form 1099. The two most common 1099s are the 1099-MISC and the 1099-NEC, but here are the other types you may encounter:
1099-INT
IRS Form 1099-INT is used to record and report interest income. This form most commonly comes from your bank to report any interest income you earned during the year.
1099-DIV
IRS Form 1099-DIV may come from your bank or another financial institution. The income will have come from a dividend, like on a savings account, that was paid by a stock or other financial holding.
1099-G
The “G” in IRS Form 1099-G stands for “government.” A 1099 G records most payments that come from a government source. This includes a state income tax refund, unemployment compensation, or a taxable grant, among other items.
1099-R
The letter at the end of Form 1099-R stands for “retirement.” This form reports the distribution of retirement benefits such as pensions, annuities, or other retirement plans.
1099-B
A Form 1099-B provides information about securities or property involved in a transaction typically handled by a broker. This includes items like common stock, i.e., the sale of 100 shares of Amazon stock or commodities.
1099-S
Parties use an IRS Form 1099-S when conducting a sale or other real estate transaction. This includes the exchange of pieces of property, too.
1099-MISC
IRS Form 1099-MISC is used in many miscellaneous cases. Another use of the form is to report that you directly sold at least $5,000 of consumer products to a buyer for resale anywhere other than a permanent retail establishment.
1099-NEC
The IRS Form 1099-NEC refers to the term “non-employee compensation.” This form is used to pay someone for work they accomplished as an independent contractor, receiving payment for their efforts.
Who is exempt from receiving a 1099 form?
You don’t need to issue or receive a 1099 for personal payments or if the payment doesn’t meet the $600 threshold.
Read about the different types of 1099 exemptions if you’re unsure whether your payment is exempt.
How are W-9s and 1099s related?
An easy way to think about IRS Form W-9 and Form 1099 is that they are the beginning and the end of a story.
Form W-9 tells the person or company you receive payment from about your Tax Identification Number (TIN), among other pieces of information.
The payer annotates the 1099 they’ll send you using that information.
What if you don’t receive all your 1099s?
Many companies have thousands of 1099s they’re responsible for producing and sending out. If you know you should have received a 1099, contact the person or company who paid you.
If the 15th of February comes around, and you still don’t have your 1099s, call 1-800- 829-1040, and the IRS will assist you, free of charge.
Where can I get a 1099 form?
To order official IRS information returns, which include a scannable Copy A for filing with the IRS and all other applicable copies of the form, visit www.IRS.gov/orderforms or grab a downloadable PDF of 1099 Forms.
Stay on top of a new address
Not surprisingly, the IRS has a form for changing your address — the IRS Form 8822-B.
Alternatively, be sure to input your new address when you file your tax returns, and the IRS will update their records.
How do you correct a 1099-MISC form?
Correcting an IRS Form 1099-MISC is fairly simple.
All you need to do is file the corrected 1099 with the “CORRECTED” box checked. If you’re mailing the form instead of using an electronic method, include an IRS Form 1096 as well.
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