1099-NEC vs 1099-MISC: which form for which payment

Payments to independent contractors go on Form 1099-NEC. Rents, prizes and certain other payments go on 1099-MISC. The reporting threshold rises to $2,000 for payments made from 2026.

Alexia M.Comparisons and market guides editor

Published: 15 September 2026
Reading time: 1 min read

Google completes "1099" with "nec", "vs w2" and "misc". US businesses mix up the two forms every January.

Which form

Payment	Form
Fees to an independent contractor or freelancer	1099-NEC
Rent for office space or equipment	1099-MISC
Prizes and awards	1099-MISC
Certain royalties	1099-MISC
Payments to attorneys for services	1099-NEC
Gross proceeds to attorneys	1099-MISC

The 2026 threshold

The One Big Beautiful Bill Act raised the threshold from $600 to $2,000 for payments made from 1 January 2026, with inflation indexing from 2027. Our article on the 1099-NEC $2,000 threshold covers the detail.

Deadlines

1099-NEC: 31 January to recipients and the IRS.
1099-MISC: 31 January to recipients; 28 February on paper or 31 March electronically to the IRS, in most cases.

Before you pay

Collect a W-9 from each US contractor before the first payment. It gives you the name and TIN you need for the form. For non-US contractors abroad, collect a W-8BEN instead.

Card and platform payments

Payments made by card or through a payment platform are reported by the processor on Form 1099-K, not by you on 1099-NEC.

Paying into the United States: the local rail

What	Detail
Local rail	ACH for batch payments; RTP and FedNow for instant transfers
Run by	Nacha for ACH; The Clearing House for RTP; the Federal Reserve for FedNow
Settlement	Same-day ACH within the business day, standard ACH the next; RTP and FedNow in seconds, 24/7, where both banks take part

Source: Nacha: Same Day ACH. Checked when this guide was last updated; the scheme's own page has the current figures.

Where Rivet fits

Rivet pays contractors in the US by ACH and in 120+ countries on local rails, with every payout recorded against the payee so year-end forms are easier to prepare. Rivet is not a bank; regulated partner institutions hold the funds. See Form 1099-K threshold and US companies paying foreign contractors.

Questions people ask

What is the difference between 1099-NEC and 1099-MISC?

NEC is for nonemployee compensation, mainly contractor fees. MISC is for other payments such as rent, prizes and certain royalties.

What is the 1099 threshold for 2026?

$2,000 per payee per year for payments made from 1 January 2026, up from $600, with inflation indexing from 2027.

When is the 1099-NEC due?

By 31 January following the payment year, to both the recipient and the IRS.

Do I file a 1099 for a contractor abroad?

Not for a non-US person working entirely outside the US. Keep a W-8BEN on file.

Sources

Written by

Alexia M.

Comparisons and market guides editor

Alexia compares the accounts, cards and payment tools companies weigh before they switch, and writes Rivet's market guides for founders in a specific country. Prices in Alexia's comparisons come from each provider's own pricing page on the date given in the article, rules come from the regulator or tax authority that sets them, and every source is listed at the end.