Checklist for Year End 2025: FORM 1099 NEC

It is that time of year again when businesses must issue Form 1099 NEC.  Payments of over $600 for services in a calendar year to a person-independent contractors, non-employees and freelancers or unincorporated entity like a sole proprietor, single member LLC or non-profit association that is not registered formally as a corporation with the state, must be issue a 1099 NEC from the payer.

Pre-Filing Actions to be Taken

1. Check to see who is eligible

2. Review of payment records for the calendar year

3. Check the payment thresholds

   1. $600 or more for non-employees

   2. For payments using 3^rd party networks like Venmo and PayPal the threshold is $20,000 and over 200 transactions at which time Venmo or PayPal will issue a 1099-K.

   3. Credit cards – you do not need to issue 1099NEC. The credit card company or payment processor will report the payments on Form 1099-K.

   4. If you pay by check and credit cards/Venmo/PayPal, you are required to issue 1099 NEC forms for the amounts paid by check.

4. Obtain Form W-9 before engaging a contractor. Have them complete the form and return it to you.

Filing Deadlines

1. January 31,2026 – recipient copies must be postmarked or emailed

2. January 31, 2026 – File with the IRS -paper or electronically

   1. Note – If you have 10 or more information returns (aggregate across all form types e.g. W2s and 1099s) you must file electronically.

3. State requirements – check your state for filing deadlines as these may differ from the federal guidelines.

Post Filing

1. Be sure to retain copies all your filed tax forms and supporting documentation for at least 3 years.

2. If you find there was an error, correct the forms as soon as possible to avoid penalties.

Contact Us

If you are unsure or have questions. Please contact us at Bright Books for any questions or filing requirements you may have.