The 1099-NEC threshold for 2026 is $2,000, up from $600. The One Big Beautiful Bill Act (Public Law 119-21), signed in July 2025, made the change, and it applies to payments you make in 2026. Those are the forms you’ll file in early 2027.
It’s the first change to the $600 threshold in decades, but it isn’t universal. Here’s what changed, what didn’t, and what to do now.
Key Takeaways
Here’s the 1099-NEC threshold for 2026 in brief:
- $2,000 for payments made in 2026, up from $600. The IRS says it may be adjusted for inflation starting in 2027.
- Most 1099-MISC boxes moved too, including rents and other income.
- Some thresholds didn’t change: royalties stay at $10, attorney gross proceeds and cash fish purchases at $600, and direct sales at $5,000.
- Backup withholding still means you file, no matter how small the payment.
- 2026 Forms 1099-NEC are due February 1, 2027, and they’re filed through IRIS, not FIRE.
What Is the 1099-NEC Threshold for 2026?
| Payments made in | Form 1099-NEC threshold |
|---|---|
| 2025 and earlier | $600 |
| 2026 | $2,000 |
| 2027 and later | $2,000, may be adjusted for inflation |
The IRS reflects the new amount in its Instructions for Forms 1099-MISC and 1099-NEC: report nonemployee compensation of $2,000 or more in box 1a of Form 1099-NEC. That includes attorneys’ fees for legal services.
Which Payments Use the $2,000 Threshold?
The higher threshold covers more than contractor pay. On Form 1099-MISC, it also applies to:
- Rents (box 1)
- Other income (box 3)
- Medical and health care payments (box 6)
- Crop insurance proceeds (box 9)
- Section 409A deferrals and nonqualified deferred compensation (boxes 12 and 15)
Exceptions That Didn’t Change
Some payments keep their old thresholds. Don’t assume everything moved to $2,000:
- Royalties: still $10 or more (1099-MISC box 2).
- Substitute payments in lieu of dividends or interest: still $10 (box 8).
- Gross proceeds paid to an attorney: still $600 (box 10).
- Cash payments for fish bought for resale: still $600 (box 11).
- Direct sales of consumer products for resale: $5,000 or more.
Other forms follow their own rules. Forms 1099-INT, 1099-DIV and 1099-R didn’t move to $2,000, and Form 1099-K has its own threshold. See our post on the Form 1099-K reporting threshold.
Backup Withholding Still Means You File
If you withheld federal income tax under the backup withholding rules, usually because a payee didn’t give you a valid TIN, you have to file a Form 1099 no matter how small the payment.
What the $2,000 Threshold Means for Your Business
Example: You pay a contractor $1,500 during 2026 for services, and no special rule applies. That payment alone doesn’t require a Form 1099-NEC. If you pay the same contractor $2,300, it does.
A few habits still matter:
- Keep collecting W-9s at onboarding, before you know what you’ll pay. A contractor who starts small can cross $2,000 by December. See what to do if a contractor refuses a W-9.
- Track totals by payee. Several small payments can add up to $2,000.
- Check your states. State reporting rules don’t always follow the federal threshold.
The threshold is one of several updates this year. See our full guide to 2026 Form 1099 filing changes, including the move from FIRE to IRIS.
When Are 2026 Forms 1099-NEC Due?
Form 1099-NEC is due to both the IRS and recipients by February 1, 2027, since January 31 falls on a Sunday. There’s no automatic extension for 1099-NEC.
You’ll also file them a new way. The IRS FIRE system takes its last filing on November 19, 2026, and 2026 returns go through IRIS. Learn more in What Is IRS IRIS?
FAQs About the 1099-NEC Threshold
Is the 1099-NEC threshold $600 or $2,000 for 2026?
$2,000 for payments made in 2026. The $600 threshold still applies to payments made in 2025 and earlier.
Does the $2,000 threshold apply to 1099-MISC?
For most boxes, yes, including rents and other income. Royalties stay at $10, and gross proceeds paid to attorneys and cash fish purchases stay at $600.
Will the threshold go up again?
The IRS says it may be adjusted for inflation starting in 2027.
Need help filing your 2026 Forms 1099? See how our outsourced filing works or contact us at (480) 706-6474.