If a client paid you $1,200 this year, you probably won't get a 1099 from them next January. That's the new 1099-NEC threshold for 2026: businesses only have to send the form when they paid you $2,000 or more during the year. Until now the number was $600.
Fewer forms doesn't mean less tax. Here's what changed, which payments the form covers, the deadlines for forms filed in early 2027, and what to keep on your invoices so your records still add up. Everything below comes from the IRS's own instructions and the tax code, checked in November 2026.
Key takeaways
The 1099-NEC threshold is $2,000 for payments made in 2026, up from $600. It applies per client: each business looks at what it paid you over the calendar year.
Most 1099-MISC boxes moved to $2,000 too. Royalties stay at $10 and attorney gross proceeds at $600.
The deadline for 2026 forms is Monday, February 1, 2027, because January 31 is a Sunday.
Card and payment-app payments go on a 1099-K, not a 1099-NEC. That threshold is over $20,000 and more than 200 transactions.
You still report all your income, with or without a form. Your invoices are the record that proves it.
What changed: the 1099-NEC threshold went from $600 to $2,000
The One Big Beautiful Bill Act, signed on July 4, 2025 (Public Law 119-21, section 70433), changed one number in section 6041(a) of the tax code: the reporting threshold went from $600 to $2,000. It applies to payments made after December 31, 2025, so 2026 is the first year it counts.
The IRS has already updated the Instructions for Forms 1099-MISC and 1099-NEC (revision 12/2026). In its words, the threshold "increased to $2,000 and may be adjusted for inflation beginning in calendar year 2027." So for payments made in 2027 and later, the number may creep up each year. The IRS hasn't published a 2027 figure yet.
1099 reporting thresholds for 2026 at a glance
What was paid | Form | Threshold for 2026 payments |
|---|---|---|
Fees for services by a nonemployee (freelancers, contractors) | 1099-NEC, box 1a | $2,000 or more |
Attorney fees for legal services | 1099-NEC, box 1a | $2,000 or more |
Rent, other income, medical and health care payments | 1099-MISC | $2,000 or more |
Royalties | 1099-MISC, box 2 | $10 or more |
Gross proceeds paid to an attorney (for example, a settlement) | 1099-MISC, box 10 | $600 or more |
Sales of consumer products for resale | 1099-NEC box 2 or 1099-MISC box 7 | $5,000 or more |
Payments through a payment app or online marketplace | 1099-K | Over $20,000 and more than 200 transactions |
Sources: IRS Instructions for Forms 1099-MISC and 1099-NEC and the IRS page Understanding your Form 1099-K.
Which payments the 1099-NEC covers
A business files Form 1099-NEC for each person it paid at least $2,000 during the year, in the course of its trade or business, for services by someone who isn't its employee. That includes fees, commissions, and prizes and awards for services. If you're a freelance designer, writer, photographer, developer or consultant billing a business client, your fees are nonemployee compensation.
What's not reported on a 1099-NEC:
Personal payments. If a private person hires you to photograph their family, they don't send a 1099. Only payments made in the course of a trade or business count.
Payments to most corporations. If your business is a corporation, or an LLC taxed as a C or S corporation, clients generally don't send you a 1099-NEC. Legal and medical services are the exceptions.
Payments for merchandise, freight, storage and similar items.
Payments by credit card or through a payment app. These are reported on Form 1099-K by the payment company instead. The IRS instructions say these payments "are not subject to reporting" on 1099-MISC or 1099-NEC, so the same income isn't counted twice.
Does the $2,000 apply per client and per year?
Yes to both. Each client adds up what it paid you during the calendar year. Your total across all clients doesn't matter.
Say you had three business clients in 2026:
Client | Paid you in 2026 | How they paid | 1099-NEC? |
|---|---|---|---|
Agency A | $6,400 | Bank transfer | Yes |
Startup B | $1,800 | Bank transfer | No, under $2,000 |
Shop C | $3,000 | Card, through an invoice link | No, card payments go on a 1099-K |
You'd get one 1099-NEC, for $6,400. You'd still report all $11,200.
What counts is when the client paid, not when you sent the invoice. An invoice dated December 15, 2026 and paid on January 8, 2027 is a 2027 payment. Keep that in mind when you match forms against your invoices in January.
1099 deadlines for the 2026 tax year
Form (2026 payments) | Due to you, the recipient | Due to the IRS |
|---|---|---|
1099-NEC | Monday, February 1, 2027 | Monday, February 1, 2027 (paper or e-file) |
1099-MISC | Monday, February 1, 2027 | Monday, March 1, 2027 on paper, or Wednesday, March 31, 2027 if filed electronically |
The regular dates are January 31 for the 1099-NEC and February 28 or March 31 for the 1099-MISC. In 2027, January 31 and February 28 fall on Sundays, and the IRS rule is that a deadline on a weekend or legal holiday moves to the next business day.
A business that files 10 or more information returns in total (1099s and W-2s added together) has to file them electronically.
What the new threshold means if you're a freelancer
You'll get fewer forms. Clients who paid you between $600 and $1,999.99 in 2026 no longer have to send a 1099-NEC. Some may send one anyway, and that's fine: it changes nothing on your side.
Your tax bill doesn't change. The IRS is plain about it: "you must report all income on your tax return," whatever forms you receive. And you have to file a return if your net earnings from self-employment were $400 or more. Self-employment tax works the same as before; our self-employment tax calculator shows what you owe on a given profit.
Your own records matter more. With fewer 1099s, the forms cover less of your income, so your invoices and bank deposits become the main proof of what you earned. The freelancer's guide to tax season walks through the records to gather and the estimated-tax dates.
If you pay subcontractors
If you hire other freelancers yourself, the same rules apply to you as a payer:
Collect a Form W-9 from each contractor before the first payment, so you have their legal name and taxpayer ID.
Track totals per contractor for the calendar year. Anyone you paid $2,000 or more by check, bank transfer or cash gets a 1099-NEC by February 1, 2027.
Skip the card and payment-app payments when you add up the 1099-NEC amount; those are the payment company's job.
Backup withholding at 24% applies if a contractor doesn't give you a taxpayer ID. The $2,000 threshold applies there too.
What freelancers should keep on their invoices
The threshold change doesn't add any invoice requirements, but a clear invoice makes year-end much easier, for you and for the client filling in your 1099. We'd keep:
Your legal name or business name exactly as on your W-9. If the name on your invoices doesn't match the one your client has on file, forms get issued to the wrong name.
Your business address and email, plus the client's business name.
An invoice number and the invoice date, and the date you were paid once the invoice is settled.
A clear description of services. If a job includes materials or products, put them on separate lines. Payments for merchandise aren't nonemployee compensation, and an itemized invoice makes the split obvious.
How the client paid. Card and payment-app payments land on a 1099-K, bank transfers and checks on a 1099-NEC. Knowing which is which saves you a puzzle in January.
Not your Social Security number. Your client gets your taxpayer ID from the W-9; it doesn't belong on an invoice that gets emailed around. If you'd rather not share your SSN at all, you can get a free EIN from the IRS.
New to invoicing? Our guide to invoicing as a freelancer covers every field.
A January checklist
List every client who paid you $2,000 or more in 2026 by bank transfer or check. Those are the 1099-NECs to expect.
Compare each form with your paid invoices for that client. Look at payment dates, not invoice dates.
Ask for a corrected form if an amount is wrong, for example if it includes a card payment or a January payment that belongs to the other year.
Check your payment platforms for a 1099-K if you crossed $20,000 and 200 transactions on any of them. If you take card payments, our comparison of Stripe, PayPal, Square and Wise fees shows what each charges.
Add up your income from your own records, not from the forms. Then plan deductions with the 2026 tax deduction cheat sheet and estimate the total with the freelance tax calculator.
Keeping track of what you've been paid
Onigiri is an invoicing app for freelancers. Every invoice has a status (Draft, Sent, Overdue or Paid), and when a client pays by card through the invoice link, it's marked paid automatically. Income tracking is included on the free plan, so in January you can see what each client actually paid without rebuilding it from your bank statements.
Need a single invoice right now? The free invoice generator makes a PDF in a couple of minutes, no signup.
This article explains federal rules for general information and isn't tax advice. State rules can differ; check with a tax professional for your situation.
