Why did I used to get a 1099-MISC for freelance work?
Contractor pay was previously reported on the 1099-MISC. The IRS created the 1099-NEC so nonemployee compensation has its own dedicated form.
Tax guide
1099-NEC vs 1099-MISC
The 1099-NEC reports money paid to independent contractors, while the 1099-MISC reports other kinds of payments like rent, royalties, and prizes.
For many years, contractor pay was reported in a box on the 1099-MISC. The IRS later moved nonemployee compensation onto its own form, the 1099-NEC, to make that income clearer. So if a business paid you for services as a freelancer or contractor, you should now receive a 1099-NEC.
The 1099-MISC is still used, but for different types of payments. Common examples include rent paid to a landlord, royalties, prizes and awards, and certain other miscellaneous income. A single business could send you both forms in the same year if it paid you for services and also paid you rent, for example.
Either way, the income is reportable. Contractor income on a 1099-NEC usually goes on Schedule C, while where 1099-MISC income goes depends on what the payment was for.
In short
Key points
- 1099-NEC reports nonemployee compensation paid to contractors
- 1099-MISC reports other income such as rent, royalties, and prizes
- Contractor pay moved off the 1099-MISC and onto the 1099-NEC
- You can receive both forms from the same payer in one year
- 1099-NEC income typically goes on Schedule C
- Where 1099-MISC income is reported depends on the type of payment
FAQ
Frequently asked questions
Can I get both a 1099-NEC and a 1099-MISC?
Yes. A payer might send a 1099-NEC for services and a 1099-MISC for something like rent in the same year.
Is one form more serious than the other?
No. Both report income you must account for. The difference is the type of payment, not the level of importance.
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