For decades, businesses had to send a 1099 to most contractors paid $600 or more in a year. That changed with the One Big Beautiful Bill Act.
What changed
- For payments made in 2026, the reporting threshold for Form 1099-NEC and Form 1099-MISC is $2,000 per payee for the year.
- Starting with 2027 payments, the threshold will be adjusted for inflation.
- Payments made in 2025 still used the old $600 threshold (those forms were filed in early 2026).
- The Form 1099-K threshold for payment apps and online marketplaces went back to more than $20,000 and more than 200 transactions.
What didn't change
- The deadline. 1099-NEC forms are still due to recipients and the IRS by January 31.
- The threshold is per payee, per year. Several small invoices from the same contractor add up.
- Income is still taxable. Contractors who don't receive a 1099 still have to report every dollar.
- States may differ. Some states have their own reporting rules, so check before assuming you can skip a form.
What to do now
- Collect a Form W-9 from every contractor before you pay them, regardless of amount.
- Check that your accounting or payroll software is set to the new threshold. Many systems default to $600.
- Run a vendor report now to see who is close to $2,000.
- Make sure workers are classified correctly. A higher threshold doesn't change whether someone should be an employee.
We handle 1099 preparation as part of our payroll and accounts payable services.
This article is general information, current as of September 2026, and is not tax, legal or financial advice for your situation. Tax rules change often. Talk with us before acting on anything here.