Glossary
Form 1099-NEC
The IRS form used to report nonemployee compensation paid to a contractor.
Form 1099-NEC, 'Nonemployee Compensation,' is the IRS information return used by businesses to report payments of $600 or more made to independent contractors, including subcontractors, during a tax year. The form was reintroduced in 2020, separating nonemployee compensation from the general-purpose 1099-MISC. For GCs, 1099-NEC filing is the January ritual: pulling every sub's W-9 data, matching to payment totals from accounting, and issuing forms to both the IRS and each sub. Deadline: January 31 of the following year.
Related terms
Form W-9
The IRS form used by US persons to provide a Taxpayer Identification Number to a payer.
Backup Withholding
A 24% withholding the IRS requires on 1099 payments when the payee's tax information is missing or incorrect.
Taxpayer Identification Number
A unique identification number issued by the IRS for tax reporting purposes.
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