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Department of the Treasury
Internal Revenue Service
Instructions for Forms

1099-MISC and 1099-NEC

(Rev. January 2024)
Miscellaneous Information and Nonemployee Compensation

Section references are to the Internal Revenue Code unless Online fillable copies. To ease statement furnishing
otherwise noted. requirements, Copies B, 1, and 2 have been made fillable
online in a PDF format available at IRS.gov/Form1099MISC
Future Developments and IRS.gov/Form1099NEC. You can complete these copies
For the latest information about developments related to online for furnishing statements to recipients and for retaining
Forms 1099-MISC and 1099-NEC and their instructions, in your own files.
such as legislation enacted after they were published, go to
IRS.gov/Form1099MISC or IRS.gov/Form1099NEC. Filing dates. Section 6071(c) requires you to file Form
1099-NEC on or before January 31, using either paper or
What’s New electronic filing procedures. File Form 1099-MISC by
February 28, if you file on paper, or March 31, if you file
E-filing returns. The Taxpayer First Act of 2019 authorized electronically.
the Department of the Treasury and the IRS to issue
regulations that reduce the 250-return e-file threshold. TD
9972, published February 23, 2023, lowered the e-file Specific Instructions for Form
threshold to 10 (calculated by aggregating all information 1099-MISC
returns), effective for information returns required to be filed
File Form 1099-MISC, Miscellaneous Information, for each
on or after January 1, 2024. Go to IRS.gov/InfoReturn for person in the course of your business to whom you have paid
e-file options. the following during the year.
Reminders • At least $10 in royalties (see the instructions for box 2) or
broker payments in lieu of dividends or tax-exempt interest
General instructions. In addition to these specific (see the instructions for box 8).
instructions, you should also use the current year General • At least $600 in:
Instructions for Certain Information Returns. Those general 1. Rents (box 1);
instructions include information about the following topics.
• Who must file. 2. Prizes and awards (box 3);
• When and where to file. 3. Other income payments (box 3);
• Electronic reporting. 4. Generally, the cash paid from a notional principal
• Corrected and void returns. contract to an individual, partnership, or estate (box 3);
• Statements to recipients. 5. Any fishing boat proceeds (box 5);
• Taxpayer identification numbers (TINs).
• Backup withholding. 6. Medical and health care payments (box 6);
• Penalties. 7. Crop insurance proceeds (box 9);
• The definitions of terms applicable for the purposes of 8. Gross proceeds paid to an attorney (box 10) (see
chapter 4 of the Internal Revenue Code that are referenced in Payments to attorneys, later);
these instructions.
• Other general topics. 9. Section 409A deferrals (box 12); or
You can get the general instructions from General 10. Nonqualified deferred compensation (box 15).
Instructions for Certain Information Returns at IRS.gov/ You may either file Form 1099-MISC (box 7) or Form
1099GeneralInstructions or go to IRS.gov/Form1099MISC or 1099-NEC (box 2) to report sales totaling $5,000 or more of
IRS.gov/Form1099NEC. consumer products to a person on a buy-sell, a
Continuous-use form and instructions. Form 1099-MISC, deposit-commission, or other commission basis for resale.
Form 1099-NEC, and these instructions are continuous use. If you use Form 1099-NEC to report sales totaling
Both the forms and instructions will be updated as needed. ! $5,000 or more, then you are required to file Form
For the most recent version, go to IRS.gov/Form1099MISC or CAUTION 1099-NEC with the IRS by January 31.
IRS.gov/Form1099NEC.
Form 1099-NEC, box 1. Box 1 will not be used for reporting You must also file Form 1099-MISC for each person from
under section 6050R, regarding cash payments for the whom you have withheld any federal income tax (report in
purchase of fish for resale purposes. box 4) under the backup withholding rules regardless of the
amount of the payment.
Form 1099-NEC, box 2. Payers may use either box 2 on
Form 1099-NEC or box 7 on Form 1099-MISC to report any Be sure to report each payment in the proper box
sales totaling $5,000 or more of consumer products for ! because the IRS uses this information to determine
resale, on a buy-sell, a deposit-commission, or any other CAUTION whether the recipient has properly reported the
basis. For further information, see the instructions, later, for payment.
box 2 (Form 1099-NEC) or box 7 (Form 1099-MISC).

Sep 15, 2023 Cat. No. 74614G

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Trade or business reporting only. Report on Form Payments to corporations for legal services. The
1099-MISC only when payments are made in the course of exemption from reporting payments made to corporations
your trade or business. Personal payments are not does not apply to payments for legal services. Therefore, you
reportable. You are engaged in a trade or business if you must report attorneys' fees (in box 1 of Form 1099-NEC) or
operate for gain or profit. However, nonprofit organizations gross proceeds (in box 10 of Form 1099-MISC), as described
are considered to be engaged in a trade or business and are earlier, to corporations that provide legal services.
subject to these reporting requirements. Other organizations Taxpayer identification numbers (TINs). To report
subject to these reporting requirements include trusts of payments to an attorney on Form 1099-MISC, you must
qualified pension or profit-sharing plans of employers, certain obtain the attorney's TIN. You may use Form W-9 to obtain
organizations exempt from tax under section 501(c) or (d), the attorney's TIN. An attorney is required to promptly supply
farmers' cooperatives that are exempt from tax under section its TIN whether it is a corporation or other entity, but the
521, and widely held fixed investment trusts. Payments by attorney is not required to certify its TIN. If the attorney fails to
federal, state, or local government agencies are also provide its TIN, the attorney may be subject to a penalty
reportable. under section 6723 and its regulations, and you must backup
withhold on the reportable payments.
Reportable payments to corporations. The following
payments made to corporations must generally be reported Deceased employee's wages. When an employee dies
on Form 1099-MISC. during the year, you must report the accrued wages, vacation
• Cash payments for the purchase of fish for resale reported pay, and other compensation paid after the date of death. If
in box 11. you made the payment in the same year the employee died,
• Medical and health care payments reported in box 6. you must withhold social security and Medicare taxes on the
• Substitute payments in lieu of dividends or tax-exempt payment and report them only as social security and
interest reported in box 8. Medicare wages on the employee's Form W-2 to ensure that
• Gross proceeds paid to an attorney reported in box 10. proper social security and Medicare credit is received. On the
Form W-2, show the payment as social security wages
Payments to attorneys. The term “attorney” includes a law (box 3) and Medicare wages and tips (box 5) and the social
firm or other provider of legal services. Attorneys' fees of security and Medicare taxes withheld in boxes 4 and 6; do
$600 or more paid in the course of your trade or business are not show the payment in box 1 of Form W-2.
reportable in box 1 of Form 1099-NEC, under section
6041A(a)(1). If you made the payment after the year of death, do not
report it on Form W-2 and do not withhold social security and
Gross proceeds paid to attorneys. Under section
Medicare taxes.
6045(f), report in box 10 payments that:
• Are made to an attorney in the course of your trade or Whether the payment is made in the year of death or after
business in connection with legal services, but not for the the year of death, you must also report the payment to the
attorney’s services, for example, as in a settlement estate or beneficiary on Form 1099-MISC. Report the
agreement; payment in box 3 (rather than as nonemployee
• Total $600 or more; and compensation). See the Example that follows. Enter the
• Are not reportable by you in box 1 of Form 1099-NEC. name and TIN of the payment recipient on Form 1099-MISC.
For example, if the recipient is an individual beneficiary, enter
Generally, you are not required to report the claimant's
the name and social security number of the individual; if the
attorney's fees. For example, an insurance company pays a
recipient is the estate, enter the name and employer
claimant's attorney $100,000 to settle a claim. The insurance
identification number of the estate. The general backup
company reports the payment as gross proceeds of
withholding rules apply to this payment.
$100,000 in box 10. However, the insurance company does
not have a reporting requirement for the claimant's attorney's Death benefits from nonqualified deferred compensation
fees subsequently paid from these funds. plans or section 457 plans paid to the estate or beneficiary of
a deceased employee are reportable on Form 1099-MISC.
These rules apply whether or not:
Do not report these death benefits on Form 1099-R.
• The legal services are provided to the payer;
However, if the benefits are from a qualified plan, report them
• The attorney is the exclusive payee (for example, the
on Form 1099-R. See the Instructions for Forms 1099-R and
attorney's and claimant's names are on one check); or
• Other information returns are required for some or all of a 5498.
payment under another section of the Code, such as section Example. Before Bailey's death on June 15, 2022, Bailey
6041. was employed and Bailey received $10,000 in wages on
For example, a person who, in the course of a trade or which federal income tax of $1,500 was withheld. When
business, pays $600 of taxable damages to a claimant by Bailey died, Bailey’s employer owed Bailey $2,000 in wages
paying that amount to a claimant's attorney is required to: and $1,000 in accrued vacation pay. The total of $3,000 (less
• Furnish Form 1099-MISC to the claimant, reporting the social security and Medicare taxes withheld) was paid to
damages pursuant to section 6041, generally in box 3; and Bailey's estate on July 20, 2022. Because Bailey’s employer
• Furnish Form 1099-MISC to the claimant’s attorney, made the payment during the year of death, Bailey’s
reporting gross proceeds paid pursuant to section 6045(f) in employer must withhold social security and Medicare taxes
box 10. on the $3,000 payment and must complete Form W-2 as
follows.
For more examples and exceptions relating to payments to • Box 1—10000.00 (does not include the $3,000 accrued
attorneys, see Regulations section 1.6045-5. wages and vacation pay).
However, these rules do not apply to wages paid to • Box 2—1500.00.
attorneys that are reportable on Form W-2, Wage and Tax • Box 3—13000.00 (includes the $3,000 accrued wages and
Statement, or to profits distributed by a partnership to its vacation pay).
partners that are reportable on Schedule K-1 (Form 1065). • Box 4—806.00 (social security tax withheld).

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• Box 5—13000.00 (includes the $3,000 accrued wages and • Wages paid to employees (report on Form W-2).
vacation pay). • Military differential wage payments made to employees
• Box 6—188.50 (Medicare tax withheld). while they are on active duty in the U.S. Armed Forces or
Bailey’s employer must also complete Form 1099-MISC as other uniformed services (report on Form W-2).
follows. • Business travel allowances paid to employees (may be
• Boxes for recipient's name, address, and TIN—The reportable on Form W-2).
estate’s or beneficiary's name, address, and TIN. • Cost of current life insurance protection (report on Form
• Box 3—3000.00 (Even though amounts were withheld for W-2 or Form 1099-R).
social security and Medicare taxes, the gross amount is • Payments to a tax-exempt organization including
reported here.) tax-exempt trusts (IRAs, HSAs, Archer MSAs, Coverdell
ESAs, and ABLE (529A) accounts), the United States, a
If Bailey’s employer made the payment after the year of state, the District of Columbia, a U.S. territory, or a foreign
death, the $3,000 would not be subject to social security and government.
Medicare taxes and would not be shown on Form W-2. Payments made to or for homeowners from the HFA
•
However, Bailey’employer would still file Form 1099-MISC. Hardest Hit Fund or similar state program (report on Form
Payments made on behalf of another person. For 1098-MA).
payments reportable under section 6041, if you make a • Compensation for injuries or sickness by the Department
payment on behalf of another person who is the source of the of Justice as a public safety officer (PSO) disability or
funds, you may be responsible for filing Form 1099-MISC. survivor's benefit, or under a state program that provides
You are the payor for information reporting purposes if you benefits for surviving dependents of a PSO who has died as
perform management or oversight functions in connection the direct and proximate result of a personal injury sustained
with the payment, or have a significant economic interest in in the line of duty.
the payment (such as a lien). For example, a bank that • Compensation for wrongful incarceration for any criminal
provides financing to a real estate developer for a offense for which there was a conviction under federal or
construction project maintains an account from which it state law. See section 139F, Certain amounts received by
makes payments for services in connection with the project. wrongfully incarcerated individuals.
The bank performs management and oversight functions Form 1099-K. Payments made with a credit card or payment
over the payments and is responsible for filing information card and certain other types of payments, including
returns for payments of $600 or more paid to contractors. For third-party network transactions, must be reported on Form
more information, see Regulations section 1.6041-1(e). 1099-K by the payment settlement entity under section
Indian gaming profits, payments to tribal members. If 6050W and are not subject to reporting on Form 1099-MISC.
you make payments to members of Indian tribes from the net See the separate Instructions for Form 1099-K.
revenues of class II or class III gaming activities conducted or Fees paid to informers. A payment to an informer as an
licensed by the tribes, you must withhold federal income tax award, fee, or reward for information about criminal activity
on such payments. File Form 1099-MISC to report the does not have to be reported if the payment is made by a
payments and withholding to tribal members. Report the federal, state, or local government agency, or by a nonprofit
payments in box 3 and the federal income tax withheld in organization exempt from tax under section 501(c)(3) that
box 4. Pub. 15-A contains the necessary Tables for makes the payment to further the charitable purpose of
Withholding on Distributions of Indian Gaming Profits to Tribal lessening the burdens of government. For more information,
Members. see Regulations section 1.6041-3(l).
State or local sales taxes. If state or local sales taxes are Scholarships. Do not use Form 1099-MISC to report
imposed on the service provider and you (as the buyer) pay scholarship or fellowship grants. Scholarship or fellowship
them to the service provider, report them on Form grants that are taxable to the recipient because they are paid
1099-MISC as part of the reportable payment. However, if for teaching, research, or other services as a condition for
sales taxes are imposed on you (as the buyer) and collected receiving the grant are considered wages and must be
from you by the service provider, do not report the sales reported on Form W-2. Other taxable scholarship or
taxes on Form 1099-MISC. fellowship payments (to a degree or nondegree candidate)
do not have to be reported to the IRS on any form, unless
Exceptions
section 6050S requires reporting of such amounts by an
Some payments do not have to be reported on Form educational institution on Form 1098-T. See section 117(b)–
1099-MISC, although they may be taxable to the recipient. (d) and Regulations section 1.6041-3(n) for more information.
Payments for which a Form 1099-MISC is not required
include all of the following. Canceled debt. A canceled debt is not reportable on Form
• Generally, payments to a corporation (including a limited 1099-MISC. Canceled debts reportable under section 6050P
liability company (LLC) that is treated as a C or S must be reported on Form 1099-C. See the Instructions for
corporation). However, see Reportable payments to Forms 1099-A and 1099-C.
corporations, earlier. Employee business expense reimbursements. Do not
• Payments for merchandise, telegrams, telephone, freight, use Form 1099-MISC to report employee business expense
storage, and similar items. reimbursements. Report payments made to employees under
• Payments of rent to real estate agents or property a nonaccountable plan as wages on Form W-2. Generally,
managers. However, the real estate agent or property payments made to employees under an accountable plan are
manager must use Form 1099-MISC to report the rent paid not reportable on Form W-2, except in certain cases when
over to the property owner. See Regulations section you pay a per diem or mileage allowance. For more
1.6041-3(d); Regulations section 1.6041-1(e)(5), Example 5; information, see the General Instructions for Forms W-2 and
and the instructions for box 1. W-3, and Pub. 463. For information on reporting employee

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moving expense reimbursements on Form W-2, see the Recipient's TIN
General Instructions for Forms W-2 and W-3. Enter the recipient's TIN using hyphens in the proper format.
Widely held fixed investment trusts (WHFITs). Trustees SSNs, ITINs, and ATINs should be in the XXX-XX-XXXX
and middlemen of WHFITs must report items of gross income format. EINs should be in the XX-XXXXXXX format.
attributable to a trust income holder (TIH) on the appropriate You should make every effort to ensure that you have
Form 1099. A tax information statement that includes the ! the correct type of number reported in the correct
information provided to the IRS on Forms 1099, as well as CAUTION format.
additional information identified in Regulations section
1.671-5(e), must be furnished to TIHs. For details, see the
current year General Instructions for Certain Information Account Number
Returns. The account number is required if you have multiple accounts
for a recipient for whom you are filing more than one Form
Statements to Recipients 1099-MISC. The account number is also required if you
If you are required to file Form 1099-MISC, you must furnish a check the “FATCA filing requirement” box. See Box 13, later.
statement to the recipient. For more information about the Additionally, the IRS encourages you to designate an account
requirement to furnish a statement to each recipient, and number for all Forms 1099-MISC that you file. See part L in
truncation, see part M in the current year General Instructions the current year General Instructions for Certain Information
for Certain Information Returns. Returns.

You can furnish each recipient with a single payee Box 1. Rents
statement reporting all Form 1099-MISC payment types. You
are required to furnish the payee statements by January 31 Enter amounts of $600 or more for all types of rents, such as
and file with the IRS by February 28 (March 31, if filing any of the following.
electronically). • Real estate rentals paid for office space. However, you do
not have to report these payments on Form 1099-MISC if you
Truncating recipient’s TIN on payee statements. paid them to a real estate agent or property manager. But the
Pursuant to Regulations section 301.6109-4, all filers of this real estate agent or property manager must use Form
form may truncate a recipient’s TIN (social security number 1099-MISC to report the rent paid over to the property owner.
(SSN), individual taxpayer identification number (ITIN), See Regulations section 1.6041-3(d) and Regulations
adoption taxpayer identification number (ATIN), or employer section 1.6041-1(e)(5), Example 5.
identification number (EIN)) on payee statements. Truncation • Machine rentals (for example, renting a bulldozer to level
is not allowed on any documents the filer files with the IRS. A your parking lot). If the machine rental is part of a contract
payer's TIN may not be truncated on any form. See part J in that includes both the use of the machine and the operator,
the current year General Instructions for Certain Information prorate the rental between the rent of the machine (report
Returns. that in box 1) and the operator's charge (report that on Form
1099-NEC in box 1).
2nd TIN Not. • Pasture rentals (for example, farmers paying for the use of
You may enter an “X” in this box if you were notified by the grazing land).
IRS twice within 3 calendar years that the payee provided an
incorrect TIN. If you mark this box, the IRS will not send you Public housing agencies must report in box 1 rental
any further notices about this account. assistance payments made to owners of housing projects.
However, if you received both IRS notices in the same See Rev. Rul. 88-53, 1988-1 C.B. 384.
year, or if you received them in different years but they both Coin-operated amusements. If an arrangement between
related to information returns filed for the same year, do not an owner of coin-operated amusements and an owner of a
check the box at this time. For purposes of the business establishment where the amusements are placed is
two-notices-in-3-years rule, you are considered to have a lease of the amusements or the amusement space, the
received one notice and you are not required to send a owner of the amusements or the owner of the space,
second “B” notice to the taxpayer on receipt of the second whoever makes the payments, must report the lease
notice. See part N in the current year General Instructions for payments in box 1 of Form 1099-MISC if the payments total
Certain Information Returns for more information. at least $600. However, if the arrangement is a joint venture,
the joint venture must file a Form 1065, U.S. Return of
For information on the TIN Matching System offered Partnership Income, and provide each partner with the
TIP by the IRS, see the current year General Instructions information necessary to report the partner's share of the
for Certain Information Returns. taxable income. Coin-operated amusements include video
games, pinball machines, jukeboxes, pool tables, slot
Corrections to Form 1099-MISC machines, and other machines and gaming devices operated
If you need to correct a Form 1099-MISC that you have by coins or tokens inserted into the machines by individual
already sent to the IRS: users. For more information, see Rev. Rul. 92-49, 1992-1
• For paper forms, see part H in the current year General C.B. 433.
Instructions for Certain Information Returns; or
• For electronic corrections, see Pub. 1220. Box 2. Royalties
Enter gross royalty payments (or similar amounts) of $10 or
If you are filing a correction on a paper form, do not more. Report royalties from oil, gas, or other mineral
! check the VOID box on the form. A checked VOID properties before reduction for severance and other taxes
CAUTION box alerts IRS scanning equipment to ignore the form
that may have been withheld and paid. Do not include
and proceed to the next one. Your correction will not be surface royalties. They should be reported in box 1. Do not
entered into IRS records if you check the VOID box. report oil or gas payments for a working interest in box 2;

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report payments for working interests in box 1 of Form b. The payments are received after termination of the
1099-NEC. Do not report timber royalties made under a salesperson's agreement to perform services for the
pay-as-cut contract; report these timber royalties on Form company.
1099-S. c. The salesperson did not perform any services for the
Use box 2 to report royalty payments from intangible company after termination and before the end of the year.
property such as patents, copyrights, trade names, and d. The salesperson enters into a covenant not to
trademarks. Report the gross royalties (before reduction for compete against the company for at least 1 year after the
fees, commissions, or expenses) paid by a publisher directly date of termination.
to an author or literary agent, unless the agent is a e. The amount of the payments depends primarily on
corporation. The literary agent (whether or not a corporation) policies sold by the salesperson or credited to the
that receives the royalty payment on behalf of the author salesperson's account during the last year of the service
must report the gross amount of royalty payments to the agreement or to the extent those policies remain in force for
author on Form 1099-MISC whether or not the publisher some period after termination, or both.
reported the payment to the agent on its Form 1099-MISC. f. The amount of the payments does not depend at all on
length of service or overall earnings from the company
Box 3. Other Income
(regardless of whether eligibility for payment depends on
Enter other income of $600 or more required to be reported length of service).
on Form 1099-MISC that is not reportable in one of the other
boxes on the form. If the termination payments do not meet all these
requirements, report them in box 1 of Form 1099-NEC.
Also enter in box 3 prizes and awards that are not for 5. Generally, all punitive damages, any damages for
services performed. Include the fair market value (FMV) of nonphysical injuries or sickness, and any other taxable
merchandise won on game shows. Also include amounts damages. Report punitive damages even if they relate to
paid to a winner of a sweepstakes not involving a wager. If a physical injury or physical sickness. Generally, report all
wager is made, report the winnings on Form W-2G. compensatory damages for nonphysical injuries or sickness,
If, not later than 60 days after the winner becomes such as employment discrimination or defamation. However,
TIP entitled to the prize, the winner can choose the option do not report damages (other than punitive damages):
of a lump sum or an annuity payable over at least 10 a. Received on account of personal physical injuries or
years, the payment of winnings is considered made when physical sickness;
actually paid. If the winner chooses an annuity, file Form
b. That do not exceed the amount paid for medical care
1099-MISC each year to report the annuity paid during that
for emotional distress;
year.
c. Received on account of nonphysical injuries (for
Do not include wages, any bonuses, prizes, and awards example, emotional distress) under a written binding
paid to your employees. Report these on Form W-2. Do not agreement, court decree, or mediation award in effect on or
include in box 3 prizes and awards for services performed by issued by September 13, 1995; or
nonemployees, such as an award for the top commission d. That are for a replacement of capital, such as
salesperson. Report them in box 1 of Form 1099-NEC. damages paid to a buyer by a contractor who failed to
complete construction of a building.
Prizes and awards received in recognition of past
accomplishments in religious, charitable, scientific, artistic, Damages received on account of emotional distress,
educational, literary, or civic fields are not reportable if: including physical symptoms such as insomnia, headaches,
• The winners are chosen without action on their part, and stomach disorders, are not considered received for a
• The winners are not expected to perform future services, physical injury or physical sickness and are reportable unless
and described in item 5b or 5c above. However, damages
• The payer transfers the prize or award to a charitable received on account of emotional distress due to physical
organization or governmental unit under a designation made injuries or physical sickness are not reportable.
by the recipient. See Rev. Proc. 87-54, 1987-2 C.B. 669. Also report liquidated damages received under the Age
Discrimination in Employment Act of 1967.
Other items required to be reported in box 3 include the
following. Taxable back pay damages may be wages and
reportable on Form W-2. See Pub. 957.
1. Payments as explained earlier under Deceased TIP
employee's wages.
2. Payments as explained earlier under Indian gaming Foreign agricultural workers. Report in box 3
profits, payments to tribal members. compensation of $600 or more paid in a calendar year to an
3. A payment or series of payments made to individuals H-2A visa agricultural worker who did not give you a valid
for participating in a medical research study or studies. TIN. You must also withhold federal income tax under the
backup withholding rules. For more information, go to
4. Termination payments to former self-employed IRS.gov and enter “foreign agricultural workers” in the search
insurance salespeople. These payments are not subject to box.
self-employment tax and are reportable in box 3 (rather than
box 1 of Form 1099-NEC) if all the following apply. Account reported under FATCA. If you are an foreign
financial institution (FFI) reporting pursuant to an election
a. The payments are received from an insurance described in Regulations section 1.1471-4(d)(5)(i)(A) a U.S.
company because of services performed as an insurance account required to be reported under chapter 4 to which
salesperson for the company. during the year you made no payments reportable on an

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applicable Form 1099, enter zero in box 3. In addition, if you Generally, payments made under a flexible spending
are an FFI described in the preceding sentence and, during ! arrangement (as defined in section 106(c)(2)) or a
the year, you made payments to the account required to be CAUTION health reimbursement arrangement, which is treated
reported under chapter 4, but those payments are not as employer-provided coverage under an accident or health
reportable on an applicable Form 1099 (for example, plan for purposes of section 106 are exempt from the
because the payment is under the applicable reporting reporting requirements of section 6041.
threshold), you must report the account on this Form
1099-MISC and enter zero in box 3. Box 7. Payer Made Direct Sales Totaling $5,000
Box 4. Federal Income Tax Withheld or More
Enter backup withholding. For example, persons who have Enter an “X” in the checkbox for sales by you totaling $5,000
not furnished their TINs to you are subject to withholding on or more of consumer products to a person on a buy-sell,
payments required to be reported in boxes 1, 2 (net of deposit-commission, or other commission basis for resale (by
severance taxes), 3, 5 (only with respect to cash payments to the buyer or any other person) anywhere other than in a
crew members for their share of proceeds from the catch), 6, permanent retail establishment. Do not enter a dollar amount
8, 9, and 10. For more information on backup withholding, in this box.
including the rate, see part N in the current year General You may either use box 7 on Form 1099-MISC or box 2 on
Instructions for Certain Information Returns. Form 1099-NEC to report the direct sales totaling $5,000 or
Also enter any income tax withheld from payments to more. If you use Form 1099-NEC to report these sales, then
members of Indian tribes from the net revenues of class II or you are required to file the Form 1099-NEC with the IRS by
class III gaming activities conducted or licensed by the tribes. January 31.
Report these sales on only one form.
Box 5. Fishing Boat Proceeds
If you are the operator of a fishing boat, enter the individual's CAUTION!
share of all proceeds from the sale of a catch or the FMV of a
distribution in kind to each crew member of fishing boats with The report you must give to the recipient for these direct
normally fewer than 10 crew members. A fishing boat has sales need not be made on the official form. It may be in the
normally fewer than 10 crew members if the average size of form of a letter showing this information along with
the operating crew was fewer than 10 on trips during the commissions, prizes, awards, etc.
preceding 4 calendar quarters.
Box 8. Substitute Payments in Lieu of Dividends
In addition, report cash payments of up to $100 per trip or Interest
that are contingent on a minimum catch and are paid solely Enter aggregate payments of at least $10 of substitute
for additional duties (such as mate, engineer, or cook) for payments received by a broker for a customer in lieu of
which additional cash payments are traditional in the industry. dividends or tax-exempt interest as a result of a loan of a
However, do not report on Form 1099-MISC any wages customer's securities. Substitute payment means a payment
reportable on Form W-2. in lieu of:
Box 6. Medical and Health Care Payments 1. A dividend, or
Enter payments of $600 or more made in the course of your 2. Tax-exempt interest to the extent that interest
trade or business to each physician or other supplier or (including original issue discount) has accrued while the
provider of medical or health care services. Include payments securities were on a loan.
made by medical and health care insurers under health, For this purpose, a customer includes an individual, trust,
accident, and sickness insurance programs. If payment is estate, partnership, association, company, or corporation.
made to a corporation, list the corporation as the recipient See Notice 2003-67, which is on page 752 of Internal
rather than the individual providing the services. Payments to Revenue Bulletin 2003-40 at IRS.gov/irb/
persons providing health care services often include charges 2003-40_IRB#NOT-2003-67. It does not include a tax-exempt
for injections, drugs, dentures, and similar items. In these organization, the United States, any state, the District of
cases, the entire payment is subject to information reporting. Columbia, a U.S. territory, or a foreign government. File Form
You are not required to report payments to pharmacies for 1099-MISC with the IRS and furnish a copy to the customer
prescription drugs. for whom you received the substitute payment.
The exemption from issuing Form 1099-MISC to a
corporation does not apply to payments for medical or health Box 9. Crop Insurance Proceeds
care services provided by corporations, including Enter crop insurance proceeds of $600 or more paid to
professional corporations. However, you are not required to farmers by insurance companies unless the farmer has
report payments made to a tax-exempt hospital or extended informed the insurance company that expenses have been
care facility or to a hospital or extended care facility owned capitalized under section 278, 263A, or 447.
and operated by the United States (or its territories), a state,
the District of Columbia, or any of their political subdivisions, Box 10. Gross Proceeds Paid to an Attorney
agencies, or instrumentalities. Enter gross proceeds of $600 or more paid to an attorney in
connection with legal services (regardless of whether the
services are performed for the payer). See Payments to
attorneys, earlier.

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Box 11. Fish Purchased for Resale for purposes of section 409A. For additional information, see
If you are in the trade or business of purchasing fish for Regulations sections 1.409A-1 through 1.409A-6; Notice
resale, you must report total cash payments of $600 or more 2008-113, available at IRS.gov/irb/
paid during the year to any person who is engaged in the 2008-51_IRB#NOT-2008-113 Notice 2008-115; ; Notice
trade or business of catching fish. You are required to keep 2010-6, available at IRS.gov/irb/2010-03_IRB#NOT-2010-6;
records showing the date and amount of each cash payment and Notice 2010-80, available at IRS.gov/irb/
made during the year, but you must report only the total 2010-51_IRB#NOT-2010-80.
amount paid for the year on Form 1099-MISC.
Boxes 16–18. State Information
"Fish" means all fish and other forms of aquatic life. "Cash" These boxes may be used by payers who participate in the
means U.S. and foreign coin and currency and a cashier's Combined Federal/State Filing Program and/or who are
check, bank draft, traveler's check, or money order. Cash required to file paper copies of this form with a state tax
does not include a check drawn on your personal or business department. See Pub. 1220 for more information regarding
account. the Combined Federal/State Filing Program. They are
provided for your convenience only and need not be
Box 12. Section 409A Deferrals completed for the IRS. Use the state information boxes to
You do not have to complete this box. For details, see Notice report payments for up to two states. Keep the information for
2008-115, available at IRS.gov/irb/ each state separated by the dash line. If you withheld state
2008-52_IRB#NOT-2008-115. income tax on this payment, you may enter it in box 16. In
If you complete this box, enter the total amount deferred box 17, enter the abbreviated name of the state and the
during the year of at least $600 for the nonemployee under all payer's state identification number. The state number is the
nonqualified plans. The deferrals during the year include payer's identification number assigned by the individual state.
earnings on the current year and prior year deferrals. For In box 18, you may enter the amount of the state payment.
additional information, see Regulations sections 1.409A-1 If a state tax department requires that you send them a
through 1.409A-6. See the instructions for box 15, later. paper copy of this form, use Copy 1 to provide information to
For deferrals and earnings under nonqualified deferred the state tax department. Give Copy 2 to the recipient for use
compensation (NQDC) plans for employees, see the General in filing the recipient's state income tax return.
Instructions for Forms W-2 and W-3.
Specific Instructions for Form
Box 13. FATCA Filing Requirement Checkbox
Check this box if you are a U.S. payer that is reporting on 1099-NEC
Form(s) 1099 (including reporting payments on this Form File Form 1099-NEC, Nonemployee Compensation, for each
1099-MISC) as part of satisfying your requirement to report person in the course of your business to whom you have paid
with respect to a U.S. account for the purposes of chapter 4 the following during the year.
of the Internal Revenue Code, as described in Regulations • At least $600 in:
section 1.1471-4(d)(2)(iii)(A). In addition, check the box if you 1. Services performed by someone who is not your
are an FFI reporting payments to a U.S. account pursuant to employee (including parts and materials) (box 1); or
an election described in Regulations section 1.1471-4(d)(5) 2. Payments to an attorney (box 1). (See Payments to
(i)(A). Finally, check the box if you are an FFI making the attorneys, later.)
election described in Regulations section 1.1471-4(d)(5)(i)
(A) and are reporting a U.S. account for chapter 4 purposes File Form 1099-NEC or Form 1099-MISC to report sales
to which you made no payments during the year that are totaling $5,000 or more of consumer products to a person on
reportable on any applicable Form 1099 (or are reporting a a buy-sell, a deposit-commission, or other commission basis
U.S. account to which you made payments during the year for resale.
that do not reach the applicable reporting threshold for any If you use Form 1099-NEC to report sales totaling
applicable Form 1099). ! $5,000 or more, then you are required to file Form
CAUTION 1099-NEC with the IRS by January 31.
Box 14. Excess Golden Parachute Payments
Enter any excess golden parachute payments. An excess You must also file Form 1099-NEC for each person from
parachute payment is the amount over the base amount (the whom you have withheld any federal income tax (report in
average annual compensation for services includible in the box 4) under the backup withholding rules regardless of the
individual's gross income over the most recent 5 tax years). amount of the payment.
See Q/A-38 through Q/A-44 of Regulations section 1.280G-1
for how to compute the excess amount. Be sure to report each payment in the proper box
because the IRS uses this information to determine
See Golden parachute payments, later, for more CAUTION! whether the recipient has properly reported the
information. payment.

Box 15. Nonqualified Deferred Compensation Trade or business reporting only. Report on Form
Enter all amounts deferred (including earnings on amounts 1099-NEC only when payments are made in the course of
deferred) that are includible in income under section 409A your trade or business. Personal payments are not
because the NQDC plan fails to satisfy the requirements of reportable. You are engaged in a trade or business if you
section 409A. Do not include amounts properly reported on a operate for gain or profit. However, nonprofit organizations
Form 1099-MISC, corrected Form 1099-MISC, Form W-2, or are considered to be engaged in a trade or business and are
Form W-2c for a prior year. Also, do not include amounts that subject to these reporting requirements. Other organizations
are considered to be subject to a substantial risk of forfeiture subject to these reporting requirements include trusts of

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qualified pension or profit-sharing plans of employers, certain excludable from the independent contractor's gross income
organizations exempt from tax under section 501(c) or and are not reportable on Form 1099-NEC if their value in any
501(d), farmers' cooperatives that are exempt from tax under month is $21 or less. However, if the value of a pass provided
section 521, and widely held fixed investment trusts. in a month is greater than $21, the full value is part of the
Payments by federal, state, or local government agencies are gross income and must be reported on Form 1099-NEC. The
also reportable. value of parking may be excludable from an independent
contractor's gross income, and, therefore, not reportable on
Reportable payments to corporations. The following
Form 1099-NEC if certain requirements are met. See
payments made to corporations must generally be reported
Regulations section 1.132-9(b), Q/A-24.
on Form 1099-NEC.
• Attorneys' fees reported in box 1. Directors' fees. You must report directors' fees and other
• Payments by a federal executive agency for services remuneration, including payments made after retirement, on
(vendors) reported in box 1. Form 1099-NEC in the year paid. Report them in box 1.
Federal executive agencies may also have to file Commissions paid to lottery ticket sales agents. A state
! Form 8596, Information Return for Federal Contracts, that has control over and responsibility for online and instant
CAUTION and Form 8596-A, Quarterly Transmittal of lottery games must file Form 1099-NEC to report
Information Returns for Federal Contracts, if a contracted commissions paid, whether directly or indirectly, to licensed
amount for personal services is more than $25,000. See Rev. sales agents. For example, State X retains control over and
Rul. 2003-66, which is on page 1115 of Internal Revenue liability for online and instant lottery games. For online ticket
Bulletin 2003-26 at IRS.gov/pub/irs-irbs/irb03-26.pdf for sales, State X pays commissions by allowing an agent to
details. retain 5% of the ticket proceeds the agent remits to State X.
For instant ticket sales, State X pays commissions by
Payments to attorneys. The term “attorney” includes a law providing tickets to the agent for 5% less than the proceeds
firm or other provider of legal services. Attorneys' fees of to be obtained by the agent from the sale of those tickets. If
$600 or more paid in the course of your trade or business are the commissions for the year total $600 or more, they must
reportable in box 1 of Form 1099-NEC, under section be reported in box 1 of Form 1099-NEC. See Rev. Rul. 92-96,
6041A(a)(1). 1992-2 C.B. 281.
Gross proceeds paid to attorneys. Gross proceeds are Payments made on behalf of another person. For
not reportable by you in box 1 of Form 1099-NEC. See the payments reportable under section 6041, if you make a
Form 1099-MISC, box 10, instructions, earlier. payment on behalf of another person who is the source of the
Payments to corporations for legal services. The funds, you may be responsible for filing Form 1099-NEC. You
exemption from reporting payments made to corporations are the payor for information reporting purposes if you
does not apply to payments for legal services. Therefore, you perform management or oversight functions in connection
must report attorneys' fees (in box 1 of Form 1099-NEC) or with the payment, or have a significant economic interest in
gross proceeds (in box 10 of Form 1099-MISC) as described the payment (such as a lien). For example, a bank that
earlier to corporations that provide legal services. provides financing to a real estate developer for a
Taxpayer identification numbers (TINs). To report construction project maintains an account from which it
payments to an attorney on Form 1099-NEC, you must obtain makes payments for services in connection with the project.
the attorney's TIN. You may use Form W-9 to obtain the The bank performs management and oversight functions
attorney's TIN. An attorney is required to promptly supply its over the payments and is responsible for filing information
TIN whether it is a corporation or other entity, but the attorney returns for payments of $600 or more paid to contractors. For
is not required to certify its TIN. If the attorney fails to provide more information, see Regulations section 1.6041-1(e).
its TIN, the attorney may be subject to a penalty under
section 6723 and its regulations, and you must backup Exceptions
withhold on the reportable payments. Some payments do not have to be reported on Form
Independent contractor or employee. Generally, you 1099-NEC, although they may be taxable to the recipient.
must report payments to independent contractors on Form Payments for which a Form 1099-NEC is not required include
1099-NEC in box 1. See the instructions for box 1. all of the following.
Section 530 of the Revenue Act of 1978, as extended • Generally, payments to a corporation (including a limited
liability company (LLC) that is treated as a C or S
TIP by section 269(c) of P.L. 97-248, deals with the
corporation). However, see Reportable payments to
employment tax status of independent contractors
corporations, earlier.
and employees. To qualify for relief under section 530,
employers must file Form 1099-NEC. Additional requirements • Payments for merchandise, telegrams, telephone, freight,
storage, and similar items.
for relief are discussed in Rev. Proc. 85-18, 1985-1 C.B. 518.
Also see Pub. 15-A for special rules that may apply to • Payments of rent to real estate agents or property
managers. However, the real estate agent or property
technical service specialists and test proctors and room
manager must use Form 1099-MISC to report the rent paid
supervisors.
over to the property owner. See Regulations section
Transit passes and parking for independent contrac- 1.6041-3(d); Regulations section 1.6041-1(e)(5), Example 5;
tors. Although you cannot provide qualified transportation and the instructions for box 1.
fringes to independent contractors, the working condition and • Wages, any bonuses, prizes, and awards paid to
de minimis fringe rules for transit passes and parking apply to employees (report these on Form W-2).
independent contractors. Tokens or farecards that enable an • Military differential wage payments made to employees
independent contractor to commute on a public transit while they are on active duty in the U.S. Armed Forces or
system (not including privately operated van pools) are other uniformed services (report on Form W-2).

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• Business travel allowances paid to employees (may be 2014-4_IRB#NOT-2014-7; and Medicaid waiver payments
reportable on Form W-2). frequently asked questions (FAQs), available at IRS.gov/
• Cost of current life insurance protection (report on Form Individuals/Certain-Medicaid-Payments-May-Be-Excludable-
W-2 or Form 1099-R). From-Income.
• Payments to a tax-exempt organization including
Canceled debt. A canceled debt is not reportable on Form
tax-exempt trusts (IRAs, HSAs, Archer MSAs, Coverdell
1099-NEC. Canceled debts reportable under section 6050P
ESAs, and ABLE (529A) accounts), the United States, a
must be reported on Form 1099-C. See the Instructions for
state, the District of Columbia, a U.S. territory, or a foreign
Forms 1099-A and 1099-C.
government.
• Payments made to or for homeowners from the HFA Employee business expense reimbursements. Do not
Hardest Hit Fund or similar state program (report on Form use Form 1099-NEC to report employee business expense
1098-MA). reimbursements. Report payments made to employees under
• Compensation for injuries or sickness by the Department a nonaccountable plan as wages on Form W-2. Generally,
of Justice as a PSO disability or survivor's benefit, or under a payments made to employees under an accountable plan are
state program that provides benefits for surviving dependents not reportable on Form W-2, except in certain cases when
of a PSO who has died as the direct and proximate result of a you pay a per diem or mileage allowance. For more
personal injury sustained in the line of duty. information, see the General Instructions for Forms W-2 and
• Compensation for wrongful incarceration for any criminal W-3, and Pub. 463. For information on reporting employee
offense for which there was a conviction under federal or moving expense reimbursements on Form W-2, see the
state law. See section 139F, Certain amounts received by General Instructions for Forms W-2 and W-3.
wrongfully incarcerated individuals.
Statements to Recipients
State or local sales taxes. If state or local sales taxes are
imposed on the service provider and you (as the buyer) pay If you are required to file Form 1099-NEC, you must furnish a
them to the service provider, report them on Form 1099-NEC statement to the recipient. For more information about the
as part of the reportable payment. However, if sales taxes are requirement to furnish a statement to each recipient, and
imposed on you (as the buyer) and collected from you by the truncation, see part M in the current year General Instructions
service provider, do not report the sales taxes on Form for Certain Information Returns.
1099-NEC. You can furnish each recipient with a single payee
Form 1099-K. Payments made with a credit card or payment statement reporting all Form 1099-NEC payment types. You
card and certain other types of payments, including are required to furnish the payee statements and file with the
third-party network transactions, must be reported on Form IRS by January 31.
1099-K by the payment settlement entity under section Truncating recipient’s TIN on payee statements.
6050W and are not subject to reporting on Form 1099-NEC. Pursuant to Regulations section 301.6109-4, all filers of this
See the separate Instructions for Form 1099-K. form may truncate a recipient’s TIN (social security number
Fees paid to informers. A payment to an informer as an (SSN), individual taxpayer identification number (ITIN),
award, fee, or reward for information about criminal activity adoption taxpayer identification number (ATIN), or employer
does not have to be reported if the payment is made by a identification number (EIN)) on payee statements. Truncation
federal, state, or local government agency, or by a nonprofit is not allowed on any documents the filer files with the IRS. A
organization exempt from tax under section 501(c)(3) that payer's TIN may not be truncated on any form. See part J in
makes the payment to further the charitable purpose of the current year General Instructions for Certain Information
lessening the burdens of government. For more information, Returns.
see Regulations section 1.6041-3(l).
2nd TIN Not.
Scholarships. Do not use Form 1099-NEC to report
scholarship or fellowship grants. Scholarship or fellowship You may enter an “X” in this box if you were notified by the
grants that are taxable to the recipient because they are paid IRS twice within 3 calendar years that the payee provided an
for teaching, research, or other services as a condition for incorrect TIN. If you mark this box, the IRS will not send you
receiving the grant are considered wages and must be any further notices about this account.
reported on Form W-2. Other taxable scholarship or
However, if you received both IRS notices in the same
fellowship payments (to a degree or nondegree candidate)
year, or if you received them in different years but they both
do not have to be reported to the IRS on any form, unless
related to information returns filed for the same year, do not
section 6050S requires reporting of such amounts by an
check the box at this time. For purposes of the
educational institution on Form 1098-T. See section 117(b)–
two-notices-in-3-years rule, you are considered to have
(d) and Regulations section 1.6041-3(n) for more information.
received one notice and you are not required to send a
Difficulty-of-care payments. Do not use Form 1099-NEC second “B” notice to the taxpayer on receipt of the second
to report difficulty-of-care payments that are excludable from notice. See part N in the current year General Instructions for
the recipient's gross income. Difficulty-of-care payments to Certain Information Returns for more information.
foster care providers are not reportable if paid for fewer than
For information on the TIN Matching System offered
11 children under age 19 and fewer than six individuals age
TIP by the IRS, see the current year General Instructions
19 or older. See section 131(c). Amounts paid for more than
for Certain Information Returns.
10 children or more than five other individuals are reportable
on Form 1099-NEC.
Certain Medicaid waiver payments may be excludable Corrections to Form 1099-NEC
from income as difficulty-of-care payments. For more If you need to correct a Form 1099-NEC that you have
information, see Notice 2014-7, available at IRS.gov/irb/ already sent to the IRS:

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• For paper forms, see part H in the current year General • Payment for services, including payment for parts or
Instructions for Certain Information Returns; or materials used to perform the services if supplying the parts
• For electronic corrections, see Pub. 1220. or materials was incidental to providing the service. For
example, report the total insurance company payments to an
If you are filing a correction on a paper form, do not
auto repair shop under a repair contract showing an amount
! check the VOID box on the form. A checked VOID for labor and another amount for parts, if furnishing parts was
CAUTION box alerts IRS scanning equipment to ignore the form
incidental to repairing the auto.
and proceed to the next one. Your correction will not be
entered into IRS records if you check the VOID box. • Commissions paid to nonemployee salespersons that are
subject to repayment but not repaid during the calendar year.
• A fee paid to a nonemployee, including an independent
Recipient's TIN contractor, or travel reimbursement for which the
Enter the recipient's TIN using hyphens in the proper format. nonemployee did not account to the payer, if the fee and
SSNs, ITINs, and ATINs should be in the XXX-XX-XXXX reimbursement total at least $600. To help you determine
format. EINs should be in the XX-XXXXXXX format. whether someone is an independent contractor or an
employee, see Pub. 15-A.
You should make every effort to ensure that you have
• Payments to nonemployee entertainers for services. Use
! the correct type of number reported in the correct Form 1042-S, Foreign Person's U.S. Source Income Subject
CAUTION format.
to Withholding, for payments to nonresident aliens.
• Exchanges of services between individuals in the course
Account Number of their trades or businesses. For example, an attorney
The account number is required if you have multiple accounts represents a painter for nonpayment of business debts in
for a recipient for whom you are filing more than one Form exchange for the painting of the attorney's law offices. The
1099-NEC. See part L in the current year General amount reportable by each on Form 1099-NEC is the FMV of
Instructions for Certain Information Returns. their own services performed. However, if the attorney
represents the painter in a divorce proceeding, this is an
Box 1. Nonemployee Compensation activity that is unrelated to the painter's trade or business.
Enter nonemployee compensation (NEC) of $600 or more. The attorney must report on Form 1099-NEC the value of
Include fees, commissions, prizes and awards for services their services. But the painter need not report on Form
performed as a nonemployee, and other forms of 1099-NEC the value of painting the law offices because the
compensation for services performed for your trade or work is in exchange for legal services that are separate from
business by an individual who is not your employee. Include the painter's business.
oil and gas payments for a working interest, whether or not • Taxable fringe benefits for nonemployees. For information
services are performed. Also include expenses incurred for on the valuation of fringe benefits, see Pub. 15-B.
the use of an entertainment facility that you treat as • Gross oil and gas payments for a working interest.
compensation to a nonemployee. Federal executive agencies • Payments to an insurance salesperson who is not your
that make payments to vendors for services, including common law or statutory employee. See Pub. 15-A for the
payments to corporations, must report the payments in this definition of employee. However, for termination payments to
box. See Rev. Rul. 2003-66. former insurance salespeople, see the instructions for box 3
of Form 1099-MISC.
What is NEC? If the following four conditions are met, you • Directors' fees as explained under Directors' fees, earlier.
must generally report a payment as NEC. • Commissions paid to licensed lottery ticket sales agents
• You made the payment to someone who is not your as explained under Commissions paid to lottery ticket sales
employee. agents, earlier.
• You made the payment for services in the course of your • Payments to section 530 (of the Revenue Act of 1978)
trade or business (including government agencies and workers. See the TIP under Independent contractor or
nonprofit organizations). employee, earlier.
• You made the payment to an individual, partnership,
estate, or, in some cases, a corporation. Golden parachute payments. A parachute payment is any
• You made payments to the payee of at least $600 during payment that meets all of the following conditions.
the year. 1. The payment is in the nature of compensation.
Self-employment tax. Generally, amounts paid to 2. The payment is to, or for the benefit of, a disqualified
individuals that are reportable in box 1 are subject to individual. A disqualified individual is one who at any time
self-employment tax. If payments to individuals are not during the 12-month period prior to and ending on the date of
subject to this tax, report the payments in box 3 of Form the change in ownership or control of the corporation (the
1099-MISC. However, report section 530 (of the Revenue Act disqualified individual determination period) was an
of 1978) worker payments in box 1 of Form 1099-NEC. employee or independent contractor and was, in regard to
Examples. The following are some examples of payments that corporation, a shareholder, an officer, or a highly
to be reported in box 1. compensated individual.
• Professional service fees, such as fees to attorneys 3. The payment is contingent on a change in the
(including corporations), accountants, architects, contractors, ownership of a corporation, the effective control of a
engineers, etc. corporation, or the ownership of a substantial portion of the
• Fees paid by one professional to another, such as assets of a corporation (a change in ownership or control).
fee-splitting or referral fees. 4. The payment has (together with other payments
• Payments by attorneys to witnesses or experts in legal described in (1), (2), and (3), above, made to the same
adjudication. individual) an aggregate present value of at least three times
the individual's base amount.

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For more details, see Regulations section 1.280G-1. Also, You may either use box 2 on Form 1099-NEC or box 7 on
see Rev. Proc. 2003-68, which is on page 398 of Internal Form 1099-MISC to report the direct sales totaling $5,000 or
Revenue Bulletin 2003-34 at IRS.gov/irb/ more. If you use Form 1099-NEC to report these sales, then
2003-34_IRB#RP-2003-68 , concerning the valuation of stock you are required to file the Form 1099-NEC with the IRS by
options for purposes of golden parachute payment rules. For January 31.
the treatment of unvested shares of restricted stock, see Rev.
Report these sales on only one form.
Rul. 2005-39, available at IRS.gov/irb/
2005-27_IRB#RR-2005-39. CAUTION!
Independent contractor. Enter in box 1 the total
compensation, including any golden parachute payment. For The report you must give to the recipient for these direct
excess golden parachute payments, see the instructions for sales need not be made on the official form. It may be in the
box 14 of Form 1099-MISC. form of a letter showing this information along with
For employee reporting of these payments, see Pub. 15-A. commissions, prizes, awards, etc.

Payments not reported in box 1. Do not report in box 1: Box 4. Federal Income Tax Withheld
• Expense reimbursements paid to volunteers of nonprofit Enter backup withholding. For example, persons who have
organizations; not furnished their TINs to you are subject to withholding on
• Deceased employee wages paid in the year after death payments required to be reported in box 1. For more
(report in box 3 of Form 1099-MISC) (see Deceased information on backup withholding, including the rate, see
employee's wages, earlier); part N in the current year General Instructions for Certain
• Payments more appropriately described as rent (report in Information Returns.
box 1 of Form 1099-MISC), royalties (report in box 2 of Form
1099-MISC), other income not subject to self-employment Boxes 5–7. State Information
tax (report in box 3 of Form 1099-MISC), and interest (use
Form 1099-INT); These boxes are provided for your convenience only and
• The cost of current life insurance protection (report on need not be completed for the IRS. Use the state information
Form W-2 or Form 1099-R); boxes to report payments for up to two states. Keep the
• An employee's wages, travel or auto allowance, or information for each state separated by the dash line. If you
bonuses and prizes (report on Form W-2); and withheld state income tax on this payment, you may enter it in
• The cost of group-term life insurance paid on behalf of a box 5. In box 6, enter the abbreviated name of the state and
former employee (report on Form W-2). the payer's state identification number. In box 7, you may
enter the amount of the state payment.
Box 2. Payer Made Direct Sales Totaling $5,000 If a state tax department requires that you send them a
or More paper copy of this form, use Copy 1 to provide information to
Enter an "X" in the checkbox for sales by you totaling $5,000 the state tax department. Give Copy 2 to the recipient for use
or more of consumer products to a person on a buy-sell, in filing the recipient's state income tax return.
deposit-commission, or other commission basis for resale (by
the buyer or any other person) anywhere other than in a
permanent retail establishment. Do not enter a dollar amount
in this box.

Instr. for Forms 1099-MISC and 1099-NEC (Rev. 01-2024) -11-

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Index
 
                                                    Fish purchases for resale 7
A                                                   Fishing boat proceeds 6                    O
Agricultural workers, foreign     5                 Foreign agricultural workers 5             Other income    5
Armed Forces         3 8,                           Form 1099-K 3 9, 
Attorneys' fees and gross                           Form W-9 2 8,                              P
  proceeds   2 6 8 10,  ,  ,                        Former insurance salesperson, 
                                                      termination payments  5 6 10 11,  , ,    Parking, value of    8
                                                                                               Payment card transactions        3 6 8 11,  ,  , 
B                                                                                              Prizes and awards     5
                                                    G
Backup withholding         2 6 8 11,  ,  ,                                                     Punitive damages      5
Broker transactions        1 6,                     Golden parachute payments    10
                                                    Gross proceeds, attorneys 2 6 8 10,  ,  ,  R
C                                                                                              Rents 1 4, 
                                                    H
Canceled debt        3 9,                                                                      Resale of fishes 7
Coin-operated amusements          4                 Health care services, payments   1 6,  ,   Royalties  1 4, 
Commissions          8 10,                            9
Construction project, escrow                                                                   S
  agent 3 8,                                        I
                                                                                               Sale of fish to reseller by fishing boat 
Consumer products totaling $5,000,                  Independent contractor payments     8,      operator  1
  indicator for      1                                10
                                                                                               Scholarships    3 9, 
Corporations, payments to         2 8 10,  ,        Indian gaming profits 3
                                                                                               Section 409A deferrals      7
Corrections  4 9,                                   Informants, fees 3 9, 
                                                                                               Section 409A income        7
Crop insurance proceeds         1 6, 
                                                    L                                          Section 530 worker         8 10, 
                                                                                               Self-employment tax        10
D                                                   Lottery ticket agents, commissions      8, State and local sales taxes      9
Damages  5                                            10                                       State Information    7 11, 
Deceased employee's wages            2 6 11,  ,                                                Substitute payments in lieu of 
Difficulty-of-care payments       9                 M                                           dividends or tax-exempt interest      1, 
Direct sales of consumer products for               Medical payments 9                          6
  resale 1                                          Medical research payments  5
Direct Sales totaling $5,000      11                Medical services payments  6               T
Directors' fees      8 10,                          Military differential payments 3 8,        Taxpayer identification number    2 8, 
                                                    Miscellaneous information 1                Termination payments, insurance 
E                                                                                               salespeople     5 10, 
Excess golden parachute payments                  7 N                                          Trade or business     2 7, 
Exchange of services         10                     Nonemployee compensation     7             Transit passes  8
                                                    Nonemployee compensation 
F                                                     (NEC) 10                                 W
FATCA filing requirements         4 5 7 10,  ,  ,   Nonqualified deferred                      Withholding:
Fees 1 3 7 10,  ,  -                                  compensation   7                          Backup    2 6 8 11,  ,  , 
Fish purchases for cash         6                                                               Indian gaming   3 6 11,  , 

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