1099 Filing Made Easy: Stay Compliant and Penalty-Free
1099 forms are a critical part of IRS compliance for businesses. Filing late or making mistakes can lead to costly penalties and unnecessary stress. At GoodBookkeeping.com, we simplify the process, ensuring accurate, timely filing so you can stay compliant and focus on what you do best.
Figures last verified against IRS guidance on .
What is a 1099 Form?
A 1099 form is a tax document required by the IRS to report specific types of payments made to individuals or businesses. These forms help ensure that all income is accurately reported and matches IRS records, maintaining compliance and transparency.
How to Prepare for Filing 1099s
Identify Who Needs a 1099
Open the reference →Use the Right 1099 Form
Open the reference →Collect Signed W-9s Early
Open the reference →File and Send On Time
Open the reference →
Do They Need a 1099?
Under the One Big Beautiful Bill Act (Public Law 119-21, §70433), the 1099-NEC and 1099-MISC reporting threshold rises from $600 to $2,000 for payments made on or after January 1, 2026. Payments made during 2025 still use the $600 threshold. The figure is indexed for inflation from 2027.
| Type of Payee | Form | 2025 payments | 2026 payments | Examples |
|---|---|---|---|---|
| Subcontractors & Freelancers | 1099-NEC | $600 | $2,000 | Plumbers, consultants, designers |
| Attorneys & Law Firms (fees) | 1099-NEC | $600 | $2,000 | Legal services, settlements |
| Attorneys (gross proceeds) | 1099-MISC | $600 | $600 | Settlement proceeds |
| Medical Providers | 1099-MISC | $600 | $2,000 | Doctors, clinics, hospitals |
| Landlords | 1099-MISC | $600 | $2,000 | Office or equipment rentals |
1099-K stays at $20,000 and 200 transactions. The backup withholding threshold also rises to $2,000.
2026 forms add boxes for tips and overtime under OBBBA. The threshold change does not override backup withholding or worker misclassification exposure.
Who is Exempt from Receiving a 1099?
Employees Receiving a W-2
Corporations (S or C Corporations)
Goods Sellers – Payments for Products
Payments Made via Credit Cards or Payment Processors
Penalties for Late 1099 Filing
The penalty is charged per information return and again per payee statement, so a single missed form can be penalized twice.
| Delay | Returns due 2025 | Returns due 2026 |
|---|---|---|
| Up to 30 days late | $60 | $60 |
| 31 days late through Aug. 1 | $130 | $130 |
| After Aug. 1 or not filed | $330 | $340 |
| Intentional disregard | $660 | $680 |
Source: IRS — Information return penalties, verified . Penalty amounts are adjusted annually for inflation.