1099-NEC vs 1099-MISC: Which Form to File in 2027
Choose the kind of payment your business made and the amount, and this selector tells you whether it goes on Form 1099-NEC or Form 1099-MISC, in which box, whether the reporting threshold is met and when the form is due at the IRS. It applies the rules for payments made in 2026, reported in early 2027: the general threshold is now $2,000, up from $600, for tax years beginning after 2025.
1099-NEC vs 1099-MISC comes down to what the payment was for. Form 1099-NEC reports nonemployee compensation: fees paid to independent contractors, freelancers and attorneys for services. Form 1099-MISC reports other business payments such as rent, royalties, prizes, medical payments and gross proceeds paid to an attorney. Both are information returns a business files for payments made in the course of its trade.
1099-NEC vs 1099-MISC: form, box and threshold
| Payment | Form and box | Report if you paid | Due at the IRS |
|---|---|---|---|
| Services by a nonemployee | 1099-NEC, box 1a | $2,000 or more | January 31 |
| Attorney fees for legal services | 1099-NEC, box 1a | $2,000 or more | January 31 |
| Gross proceeds paid to an attorney | 1099-MISC, box 10 | $600 or more | February 28 (paper), March 31 (e-file) |
| Rent | 1099-MISC, box 1 | $2,000 or more | February 28 (paper), March 31 (e-file) |
| Royalties | 1099-MISC, box 2 | $10 or more | February 28 (paper), March 31 (e-file) |
| Prizes, awards, other income | 1099-MISC, box 3 | $2,000 or more | February 28 (paper), March 31 (e-file) |
| Medical and health care payments | 1099-MISC, box 6 | $2,000 or more | February 28 (paper), March 31 (e-file) |
The table follows the IRS Instructions for Forms 1099-MISC and 1099-NEC, December 2026 revision, which the IRS says to use "to file 2026 information with the IRS in early 2027".
What changed: the $2,000 threshold
For years the trigger for most of these payments was $600. The IRS instructions now state that, for tax years beginning after 2025, the minimum threshold for reporting certain payments increased to $2,000 and may be adjusted for inflation beginning in calendar year 2027. Two lines did not move: royalties are still reported from $10, and gross proceeds paid to an attorney from $600. So a contractor paid $1,500 during 2026 no longer triggers a 1099-NEC, while one paid $5,000 still does.
Attorneys and corporations: the two traps
Attorney payments split in two. Fees you pay a lawyer for legal services go in box 1a of Form 1099-NEC. Gross proceeds, for example a settlement paid to the lawyer on a client's behalf, go in box 10 of Form 1099-MISC. Payments to corporations are generally not reportable, but the IRS lists exceptions that include legal services and medical and health care payments, so those are reported even when the payee is incorporated. The selector applies that rule when you mark the payee as a corporation.
Penalties for filing late
The IRS charges a penalty per information return. For returns due in 2026 it is $60 if you file up to 30 days late, $130 if you file 31 days late through August 1, and $340 after August 1 or if you do not file; intentional disregard is $680 per return. The IRS page had not yet listed amounts for returns due in 2027 when this page was checked, and a separate penalty applies to payee statements.
Sources: IRS Instructions for Forms 1099-MISC and 1099-NEC (Rev. December 2026); IRS, Information return penalties. Last updated: October 2026.