IRS Updates Form 1099 Thresholds

Many clients will be relieved to hear that the threshold for certain forms in the 1099 series have been raised for 2026, and may continue to be adjusted for inflation in future years. 

More information is available directly from the IRS here, but some common forms and their updates are:

1099-NEC

This form reports payments to non-employees that are not corporations; that is, they are individuals, sole proprietorships, ect. Formerly, the reporting requirement was $600 of payments in one year. Beginning in 2026, a 1099-NEC is not required until $2,000 of payments in one year. If you withheld any backup withholding to the IRS for that person, a 1099-NEC is required regardless of the total payments. More info here.

1099-MISC

Box 1 of this form reports rents paid for office space, machine rentals, or pasture rentals. Formerly, the reporting requirement was $600 of payments in one year. Beginning in 2026, a 1099-NEC is not required until $2,000 of payments in one year. More info here.

1099-K

Some clients may have received a Form 1099-K from payment platforms such as venmo, paypal, or square; sometimes the form is issued whether that income is taxable to you or not. The One Big Beautiful Bill Act reinstated the $20,000/200 transactions limit for issuing Form 1099-K. More info here. 

Any client with questions can contact us here.