Who sends me a 1099-NEC?
A business or client that paid you for services as a contractor sends it, and they also file a copy with the IRS.
Tax guide
What Is a 1099-NEC?
A 1099-NEC is a tax form that reports money a business paid you for work you did as an independent contractor rather than as an employee.
Form 1099-NEC stands for Nonemployee Compensation. A business that pays you for services as a contractor or freelancer is generally required to send you this form when your total pay from them reaches the IRS reporting threshold for the year. You typically get a copy by early in the following year, and a copy also goes to the IRS.
Because no taxes were withheld from these payments, the income is yours to report and pay tax on. Most people report 1099-NEC income on Schedule C, and they may also owe self-employment tax, which covers Social Security and Medicare. Even if you never receive the form, you are still required to report the income you earned.
Keep your own records of what you were paid and your business expenses so your numbers are accurate. The form only shows your gross pay, not the deductions you may be entitled to claim against it.
In short
Key points
- Reports pay you received as an independent contractor, not an employee
- NEC stands for Nonemployee Compensation
- No taxes are withheld, so you are responsible for the tax owed
- Income is usually reported on Schedule C
- You may owe self-employment tax of 15.3 percent on the net profit
- You must report the income even if a form is never sent to you
FAQ
Frequently asked questions
Do I owe taxes on 1099-NEC income?
Yes. Because nothing was withheld, you generally owe income tax and self-employment tax on the net profit after expenses.
What if I did not get a 1099-NEC but earned the money?
You still must report all income you earned, even when no form arrives. Use your own records to report it accurately.
Rather have a pro just handle it?
Tell us what you've got and we'll come back within one business day with the plan and the price · from a preparer who knows your line of work.
Tell us what you’ve got