What Form 1099-MISC Reports and Who Receives It

The 1099-MISC reports miscellaneous income paid to you by businesses and other payers

Form 1099-MISC is a tax document that reports money you received that does not fit into other 1099 categories. A business, nonprofit, or individual sends you this form when they paid you for services, rent, royalties, or other types of income during the year. The payer is required to send you a copy and file a copy with the IRS, so the IRS knows about the income you received.

The form lists different types of income in separate boxes. Box 1 reports nonemployee compensation — money paid for work you did as an independent contractor or freelancer. Box 5 reports fishing boat proceeds. Box 7 reports nonqualified deductions. Other boxes report rent, royalties, prizes, medical payments, and income from crop insurance. You may receive a 1099-MISC with only one box filled in, or with several boxes filled in if you received different types of income from the same payer.

The 1099-MISC is different from a W-2, which reports wages from an employer who withheld taxes. A 1099-MISC reports income where no taxes were withheld, and you are responsible for reporting it and paying tax on it yourself. You do not have to be self-employed to receive a 1099-MISC — you might receive one for a single project, rental income, or a prize.

Key Takeaways

• Form 1099-MISC reports miscellaneous income such as nonemployee compensation, rent, royalties, and prizes that a payer sends to you and the IRS.
• The payer must send you a copy by January 31 of the year after payment, and they file a copy with the IRS at the same time.
• Different boxes on the form report different types of income, and Box 1 is the most common box for independent contractor work.
• You must report all 1099-MISC income on your tax return, even if you do not receive the form or the amount seems incorrect.

Who sends you a 1099-MISC and when

Any business, nonprofit, or individual who paid you at least $600 in miscellaneous income during a calendar year must send you a 1099-MISC. The threshold is $600 for most types of income reported on this form, though some categories have different minimums. For example, payments to attorneys must be reported if they total $600 or more, and medical and dental payments must be reported if they total $600 or more.

The payer must send you the form by January 31 of the following year. For example, if you received payments in 2024, the payer sends you the form by January 31, 2025. The payer also files a copy with the IRS and your state tax agency on the same important date. If a payer does not send you a form by early February, contact them to ask for it — they are required to provide it.

Some payers send the form electronically, and some mail it. Ask the payer how they will send it if you are unsure. If you move during the year, update your address with any payers who owe you a 1099-MISC so the form reaches you.

What each box on the form means

Form 1099-MISC has numbered boxes, and each box reports a different type of income. You will see only the boxes that explore to you filled in. Here are the most common ones:

• Box 1 (Rents): Money you received for renting property, such as a house, apartment, or land. This box is also sometimes used for other rental income.
• Box 2 (Royalties): Money you received for the use of your creative work, such as books, music, patents, or oil and gas rights.
• Box 3 (Other income): Income that does not fit into other boxes, such as prizes, awards, or gambling winnings.
• Box 5 (Fishing boat proceeds): Money paid to crew members on a fishing boat.
• Box 6 (Medical and dental payments): Payments made to you for medical or dental services.
• Box 7 (Nonqualified deductions): Deductions related to nonqualified deferred compensation plans.
• Box 8 (Substitute payments in lieu of dividends or interest): Payments made to you in place of dividends or interest you would have received.

The most common box for independent contractors and freelancers is Box 1, which reports nonemployee compensation. However, the IRS moved nonemployee compensation reporting to a new form called Form 1099-NEC starting in 2020. Many payers now use 1099-NEC for contractor payments instead of 1099-MISC Box 1, though some still use 1099-MISC. You may receive either form or both, depending on the payer.

How to report 1099-MISC income on your tax return

You must report all income shown on a 1099-MISC on your federal tax return, even if you did not receive the form or disagree with the amount. The IRS receives a copy of every 1099-MISC filed, so they know what income the payer reported about you.

Where you report the income depends on the type. Rental income goes on Schedule E. Royalties go on Schedule E. Nonemployee compensation (if still reported on 1099-MISC Box 1) goes on Schedule C as self-employment income. Medical and dental payments go on Schedule C if you are a healthcare provider. Prizes and awards go on your main tax form as other income. Your tax software or tax preparer will guide you to the correct line based on the box number.

If you received a 1099-MISC but the amount is wrong, contact the payer first and ask them to send you a corrected form, called a Form 1099-MISC with "CORRECTED" marked in the top left corner. The payer must send the corrected form to you and file it with the IRS. If the payer refuses to correct it, you can still report the correct amount on your return and attach a note explaining the discrepancy.

The difference between 1099-MISC and 1099-NEC

Form 1099-NEC reports nonemployee compensation — money paid to independent contractors and freelancers for services. Form 1099-MISC reports all other miscellaneous income. Starting in 2020, the IRS required payers to use 1099-NEC for contractor payments instead of 1099-MISC Box 1.

However, the change was gradual, and many payers still use 1099-MISC for contractor work. You may receive a 1099-NEC, a 1099-MISC, or both from the same payer, depending on their accounting system and when they updated it. Both forms report income you must claim on your tax return. If you receive both forms from the same payer for the same work, contact them to clarify which is correct, because reporting both would overstate your income.

What to do if you do not receive a 1099-MISC

If a payer owed you a 1099-MISC and did not send it by early February, contact them and ask for it. Provide your name, address, and the dates and amounts of payments you received. Keep records of all payments — invoices, bank deposits, emails, or contracts — so you can prove the income if needed.

You are still required to report the income on your tax return even if you never receive the form. The payer may have filed it with the IRS under the wrong address or name, or they may have failed to file it at all. Either way, you owe tax on the income. Report what you received based on your own records. If the IRS later receives a 1099-MISC that does not match your return, they will contact you to explain the difference.

Frequently Asked Questions

Do I have to report 1099-MISC income if I did not receive the form?

Yes. You must report all income you received, whether or not you receive a 1099-MISC. The IRS tracks 1099s filed by payers, so if a payer reported you to the IRS and you did not report it on your return, the IRS will notice the discrepancy. Report the income based on your own records — bank deposits, invoices, or contracts.

What if the 1099-MISC amount is wrong?

Contact the payer and ask them to issue a corrected form marked "CORRECTED" at the top. They must send the corrected form to you and file it with the IRS. If they refuse, report the correct amount on your return and attach a note explaining why it differs from the 1099-MISC.

Is 1099-MISC income subject to self-employment tax?

It depends on the type of income. Nonemployee compensation (Box 1 on 1099-MISC, or Box 1 on 1099-NEC) is subject to self-employment tax. Rental income and royalties are generally not subject to self-employment tax. Your tax preparer can tell you which income on your 1099-MISC is subject to self-employment tax based on the box number.

Can I deduct business expenses against 1099-MISC income?

Yes, if the income is from self-employment or business activity. You can deduct ordinary and necessary business expenses on Schedule C. Rental income allows deductions for property expenses on Schedule E. Keep receipts and records of all expenses you claim. Medical and dental payments, prizes, and other miscellaneous income have different rules — consult a tax preparer about what you can deduct.