A US tax form businesses use to report $600 or more paid to a non-employee contractor during the year, filed with the IRS and sent to the contractor.
The 1099-NEC (“Nonemployee Compensation”) is how US businesses report money paid to independent contractors. If a client pays you $600 or more in a year for your services, they generally must file a 1099-NEC with the IRS and send you a copy, usually by January 31.
For sellers, a 1099-NEC is a record, not a bill — you owe tax on your income whether or not you receive one. Report all your earnings, including from clients who paid under $600 and never sent a form. For buyers who hire contractors, collecting a W-9 up front makes issuing 1099s at year-end painless.
The common confusion: the amount on your 1099s may not match your actual income, and you don’t subtract expenses on the form itself. You track business expenses separately on your return. Because filing thresholds and rules shift, confirm your specific obligations with a tax professional — especially the first year you cross into contractor income.