Do I Have to Send a 1099? The Number Just Changed.

For as long as most of us have been in business, the rule was $600. Pay a contractor more than that across the year, send them a 1099. It had been $600 since the 1950s.

It isn’t $600 anymore.

The new number is $2,000.

Straight from the IRS instructions for Forms 1099-MISC and 1099-NEC: “For tax years beginning after 2025, the minimum threshold amount for reporting certain payments required to be reported on certain information returns and/or perform backup withholding on those payments increased to $2,000 and may be adjusted for inflation beginning in calendar year 2027.”

That covers payments you are making right now, in 2026. So the photographer you paid $1,400 this spring, the VA you paid $900, the designer you paid $1,800 — under the old rule every one of those was a 1099. Under the new one, none of them are.

What this does not change: the deduction.

I want to be loud about this part, because it’s where I see people talk themselves into a worse outcome.

The 1099 is a reporting form. It is not what makes an expense deductible. You deducted that $1,400 photographer whether or not a form went out, and you still do. If you catch yourself thinking “well, if I don’t have to send the form, maybe I shouldn’t claim it” — no. Claim it. Keep the invoice.

Still collect the W-9. Every time.

Before you pay anyone, get the W-9. Yes, even under $2,000.

Here’s why. In January you’ll be looking at a year of payments, and you will not remember who quietly crossed $2,000 across four invoices spread over eight months. Chasing a W-9 out of someone you worked with once in March is one of the least pleasant jobs in a small business. Collecting it up front costs you nothing.

The 1099-K is a different form with a different rule.

That’s the one Stripe, PayPal, Shopify Payments and Etsy send you. Its threshold sits at $20,000 and more than 200 transactions — which means a lot of online sellers who used to get one no longer will.

And the same warning applies in reverse: not receiving a form does not make the income untaxable. It’s reportable either way. The paperwork changed. The tax didn’t.

One caution before you apply $2,000 across the board.

The 1099-MISC covers several different kinds of payment, and they don’t all run on the same number — royalties and payments to attorneys, among others, have their own thresholds. If you’re issuing anything other than a straightforward 1099-NEC for contractor work, check the category first.

If you pay freelancers regularly and you’d rather have someone look at your year before January gets here, that’s the kind of thing I do. Book Your Appointment Here!