Many entrepreneurs we work with are tripped up on 1099 requirements and in particular the 1099 filing deadline. Some folks don’t realize they have a requirement to file and end up owing penalties. In this segment, we’ll discuss 1099 basics, the 1099 filing deadline, requirements, and penalties. At Advington Stone, we support individuals and businesses of all sizes, contact us for assistance with 1099’s and more or see our business tax support offerings.

In short, the IRS uses 1099 forms to track various types of income that aren’t reported on a W-2, including payments to freelancers, rent, interest, dividends, or other non-employee compensation.

When is a 1099 required?

Form 1099 must generally be filed whenever a business makes payments totaling $600 or more in a calendar year to a non-employee or unincorporated business for services rendered. This includes payments to independent contractors, consultants, freelancers and more. The most commonly used version and likely most relevant for your business, Form 1099-NEC (Nonemployee Compensation), was reinstated by the IRS in 2020 to simplify reporting of non-employee payments. Per the IRS Instructions for Form 1099-NEC, you must issue a 1099-NEC if you:

• Paid someone at least $600 for services performed in the course of your trade or business
• Made payments to a person who is not your employee
• Paid an individual, partnership, estate, or in some cases, a corporation (such as for legal or medical services)
• Made payments via cash, check, or direct deposit (payments via credit card or PayPal are usually reported by the payment processor on Form 1099-K instead).

Other common 1099 forms include the following, though you are most likely to issue 1099-MISC and 1099-NEC as an individual/business:

• 1099-MISC – for rent, royalties, and certain other miscellaneous income
• 1099-INT – for interest income of $10 or more
• 1099-DIV – for dividends and distributions
• 1099-K – for third-party payment transactions exceeding $20,000 and 200 transactions (thresholds will be changing in coming years)

Key Filing Deadlines

The 1099 filing deadline depends on both the form type and how it’s filed.

Form 1099-NEC:

To recipients: January 31, 2026 (for the 2025 tax year)

To the IRS: January 31, 2026 (whether paper or electronic filing)

Form 1099-MISC:

To recipients: January 31, 2026.

To the IRS:

By paper: February 28, 2026.

Electronically: March 31, 2026.

Businesses filing 10 or more information returns in a calendar year (including all 1099s, W-2s, and others) must file electronically starting with the 2024 filing season, as per the IRS’s Final Regulations (T.D. 9979). Filing early is strongly advised. You’ll need accurate payee details including legal name, address, and Taxpayer Identification Number (TIN). You can usually obtain these via Form W-9 before payments are made.

How to File

You can file 1099 forms either electronically via the IRS FIRE System (Filing Information Returns Electronically or by mail using official IRS scannable forms (not printed copies from your computer). Many accounting software solutions, such as QuickBooks or specialized e-filing services, can automatically generate and submit 1099s to both recipients and the IRS. At Advington, we also provide professional bookkeeping services that utilize these tools. A fully managed bookkeeping process is relatively inexpensive (starting at $399/mo) and can pre-empt any concerns around 1099 due dates.

Penalties for Late or Incorrect Filing

Failing to file 1099s on time or submitting incorrect information can result in significant penalties under IRC §6721 and §6722. The penalty amount depends on just how late the form is filed.

• $60 per form – if filed within 30 days after the due date
• $120 per form – if filed more than 30 days late but before August 1
• $310 per form – if filed after August 1 or not filed at all
• $630 per form – if there is intentional disregard of filing requirements

For small businesses these penalties can quickly accumulate, especially if multiple forms are missing or contain incorrect information. 

Avoiding Common Mistakes

To avoid issues you should take the following steps.

• Collect Form W-9 from all vendors before making payments
• Verify TINs using the IRS TIN Matching Program
• Keep accurate records of all payments (or utilize bookkeeping services to do this for you)
• Review deadlines annually, since IRS requirements sometimes change

Final Thoughts

Staying compliant with IRS 1099 filing rules protects your business from unnecessary fines and administrative headaches. While the process may seem straightforward, the details matter and the IRS enforces deadlines strictly. If you’re unsure about which forms you need or want assistance with electronic filing, our team can handle the process from start to finish. We ensure full compliance with IRS regulations, contact us today or see our offerings.