Get Form 1099-NEC (Rev. January 2024). Nonemployee Compensation

As a self-employed individual, you're required to report all income. If your net earnings are over $400, then you'll have to pay self-employment taxes using Schedule SE . You'll need to submit the 1099-NEC when you file your taxes, but remember, estimated tax payments are usually required throughout the year.

The nonemployee compensation reported in Box 1 of Form 1099-NEC is generally reported as self-employment income and is usually subject to self-employment tax. Payments from your trade or business to individuals that aren't reportable on the 1099-NEC form, would typically be reported on Form 1099-MISC.

A 1099 employee is an independent contractor. The name derives from the Internal Revenue Service's (IRS) Form 1099 that contract workers must complete to report their earnings. Freelancers, consultants, self-employed workers, and sole proprietors are common types of 1099 employees.

A business must file Form 1099-NEC if it paid someone at least $600 during the year and the person meets these criteria: They are not an employee. The business made payment for services in the course of your business — in other words, this wasn't a personal payment.

Nonemployee compensation 1099-NEC The 1099-NEC only needs to be filed if the business has paid you $600 or more for the year. If you made less than $600, you'll still need to report your income on your taxes, unless you made under the minimum income to file taxes.

If payment for services you provided is listed on Form 1099-NEC, Nonemployee Compensation, the payer is treating you as a self-employed worker, also referred to as an independent contractor. You don't necessarily have to have a business for payments for your services to be reported on Form 1099-NEC.

The 1099-NEC is the new form to report nonemployee compensation—that is, pay from independent contractor jobs (also sometimes referred to as self-employment income). Examples of this include freelance work or driving for DoorDash or Uber.

The 1099 rules for types of items to report for 2023 in 2024 on Form 1099-MISC and 1099-NEC per IRS Instructions generally apply to income payments of at least $600 and backup withholding of federal and state income taxes.