1099 Form: How It Works, Who Gets One
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If you're generating certain nonwage income this year, keep an eye out for a 1099 form in your inbox by early next year. This tax form can have a big impact on your tax life.
What is a 1099 form?
A 1099 form is a tax statement that lists how much income you earned from a person or business that paid you nonemployee compensation throughout the year. There are several types of 1099 forms — which one(s) you receive depends on the type of income earned.
The payer fills out the 1099 and sends copies to you and the IRS. You'll typically receive a 1099 by the end of January or early February the year after the income was earned.
What is a 1099 form used for?
You use your 1099 to figure out how much income you received during the year and what kind of income it was. You'll report that income in different places on your tax return, depending on the type of income.
If you need help estimating how income on a 1099 form could affect your tax bill, check out our free tax calculator.
Who gets a 1099?
People can get a 1099 form for different reasons. For example, freelancers, independent contractors, and other gig workers who fill out a W-9 form at the start of a business relationship often get a 1099-NEC from their clients outlining their income earned.
Do I need a 1099 to file my taxes?
Yes, you'll need your 1099 to accurately report your income on your tax return. A copy of this form is also sent to the IRS, so you can be sure the agency knows about this income.
However, simply receiving a 1099 tax form doesn’t necessarily mean you owe taxes on that money. You might have deductions that offset the income, or some or all of it might be sheltered based on the characteristics of the asset that generated it.
When should I receive my 1099?
The majority of 1099s are due to the recipient by Jan. 31 of the year following when the income was earned. If the 1099 due date falls on a weekend, the deadline rolls over to the next business day. Certain types of 1099s, such as a 1099-S, are typically due by Feb. 15.
If you're expecting a 1099 and don't receive it by mid-February, the IRS suggests contacting the payer as soon as possible. You can also call the IRS' main customer service number for help if you can't get in touch with the entity that owes you a 1099.
Types of 1099 forms
There are several kinds of 1099 tax forms. The IRS also refers to them as "information returns." Here’s a basic rundown of the Form 1099s most likely to cross your path.
1099-A
You might receive one Form 1099-A if your mortgage lender canceled some or all of your mortgage, or you were involved in a short sale of your home. Why? Canceled debt is income in the eyes of the IRS — and it’s generally taxable.
1099-B
Form 1099-B covers income from the sale of several types of securities, as well as some types of bartering that take place via bartering exchanges, typically websites. In that case, the exchange might "1099" you for the income you received. A 1099 isn't usually required if you barter with someone directly, though you may have to report the income.
1099-C
If you persuaded a credit card issuer or another lender to settle your debt for less than you owe, you’re not entirely off the hook. The amount the lender forgives is probably taxable income, and the 1099-C tells all.
1099-CAP
You might receive a 1099-CAP if you hold shares of a corporation that was acquired or underwent a big change in capital structure and you got cash, stock or other property as a result.
1099-DIV
One of the most common flavors of this form, the 1099-DIV reports dividends you received. This doesn’t include dividends on your share account at the credit union. The IRS considers those interest, so they appear on a 1099-INT.
1099-G
If you received money from the state, local or federal government — including a tax refund, credit or offset — you might get one of these. If you were on unemployment during the year, you might also have a 1099-G headed your way.
1099-INT
If you earned $10 or more in interest from a bank, brokerage or other financial institution, you’ll receive a 1099-INT.
1099-K
If you received $5,000 or more of business income or payments for goods and services via credit card or a third-party payment system (such as Venmo or Cash App) in 2024, you should be sent a summary of those payments on a 1099-K.
The IRS had planned to lower the reporting threshold to $600 for tax year 2023 but delayed implementing the rule and introduced phase-in thresholds. As mentioned, the threshold for 2024 is $5,000; that lowers to $2,500 for 2025 and $600 for 2026.
1099-LTC
If your long-term care insurance paid out benefits during the year, the insurer will probably file a Form 1099-LTC. If you received payments from the accelerated death benefits of a life insurance policy, those are reported on this form, too.
1099-MISC
This is a catch-all for income that doesn’t fit into other 1099 categories, though it does have some specific purposes. Income from prizes and awards are examples.
1099-NEC
In 2020, the IRS reintroduced the 1099-NEC, which companies now use to report money paid to people who did work for them but weren't employees. In other words, if you freelanced, were self-employed or had a side gig, your clients should send you a Form 1099-NEC instead of a Form 1099-MISC early next year.
1099-OID
You might receive Form 1099-OID if you bought bonds, notes or other financial instruments at a discount to the face value or redemption value at maturity. Typically, the instrument must have a maturity of more than one year.
1099-PATR
If you belong to a co-op and received at least $10 in patronage dividends, expect to see Form 1099-PATR in your mailbox.
1099-Q
The 1099-Q reports money that you, your child, or your child's school receives from a 529 plan. Keep in mind, however, that the earnings in a 529 plan are generally not subject to tax when they’re used for qualified education expenses, so for many people, the 1099-Q is just record-keeping.
1099-R
If you got distributions from a pension, retirement plan, profit-sharing program, an IRA or an annuity, you might receive a 1099-R. (Remember, many retirement plans are tax-advantaged, so this form might be simple record-keeping on behalf of the IRS.) If you took a loan from your retirement plan, you might have to treat it as a distribution, which means it might be on this form, too, as well as permanent and total disability payments under life insurance contracts.
1099-S
Anyone responsible for closing a sale or an exchange of real estate furnishes this statement to you, reporting the proceeds. Again, the proceeds from the sale of your house or other real estate aren’t necessarily taxable, so do your homework.
1099-SA
This is the form you’ll receive if you took any distributions from your health savings account, Archer medical savings account or Medicare Advantage. HSA and Archer distributions generally aren't taxable if you use them to pay for qualified health expenses. So again, for many people, a 1099-SA is simply proof that the money left the account and went to you.
What is a 1099 employee?
The phrase "1099 employee" generally describes a person who, in the eyes of the IRS, is an independent contractor, also called self-employed or a freelancer. People who are considered 1099 workers are generally asked to fill out a W-9 at the start of a new work relationship or contract.
If you get a 1099-NEC from your employer, that's a sign that the company sees you as an independent contractor rather than an employee.
