Yes. The IRS requires that you report all of your income, even if it's less than $600 and you didn't get a tax form for it. Follow these steps to enter your income. We'll ask you some questions to determine if your income is from self-employment or is ordinary income.
You're ready to start e-filing your income tax return, only to discover that you're missing a Form 1099. Now what? No problem: You can e-file without the physical 1099 in hand.
If you still do not get the form by February 15, call the IRS for help at 1-800- 829-1040. In some cases, you may obtain the information that would be on the 1099 from other sources.
Summary: Freelancers and independent contractors often get paid in cash, but they still need to report this income to the IRS, even if they don't receive a 1099 form. Cash payments count as self-employment income and must be included on Schedule C when filing taxes.
Failure to File: Filing Less Than 30 Days Late
The penalty for filing form 1099 less than 30 days late or or a failure to file correctly within 30 days is $50 per form with a maximum penalty of $194,500 for small businesses.
You are still considered self-employed even if you are paid in cash and do not receive a form 1099-MISC or 1099-NEC. If contractors earned more than $400 in cash, the IRS considers them to be self-employed.
Will the IRS catch a missing 1099? The IRS knows about any income that gets reported on a 1099, even if you forgot to include it on your tax return. This is because a business that sends you a Form 1099 also reports the information to the IRS.
Signing in to your personal my Social Security account and selecting the "Replace Your Tax Form SSA-1099/SSA-1042S" link. Go to the "Choose a year" dropdown menu. Choose the desired year and select the "Download" link. The most recent tax year's SSA-1099/SSA-1042S will be available beginning every February 1.
That being said, if you do not receive a 1099 form, you should not panic. You can easily file the tax return for that income with only the information that you know. As long as you know the amount you need to file for and don't file for a lower amount, you should be fine.
If you don't include this and any other taxable income on your tax return, you may be subject to a penalty. Failing to report income may cause your return to understate your tax liability. If this happens, the IRS may impose an accuracy-related penalty that's equal to 20% of your underpayment.
The 1099-NEC only needs to be filed if the business has paid you $600 or more for the year. Even if you made less than $600, you'll still need to report all your income on your tax return.
Who Doesn't Need to Receive a Form 1099-MISC or 1099-NEC? Generally, C corporations, S Corporations, and LLCs formed as corporations or S Corps don't need to receive a 1099-NEC or 1099-MISC. On irs.gov, check the 1099-NEC instructions and 1099-MISC instructions for exceptions when you are required to issue a 1099.
Even if you don't get a Form 1099-K, if you received payments for goods, services or property, you must report your income. This includes payments you receive in cash, property, goods, digital assets or foreign sources or assets.
To Correct a Tax Return Mistake, File an Amendment
It should be filed if you forgot to claim credits and deductions, or need to correct filing status and income – whether the result is a tax refund or a tax bill.
For taxpayers who did not receive a Form 1099-S, use sale documents and other records. If the taxpayer can exclude the entire gain from a sale, the person responsible for closing the sale (for example, a real estate broker or settlement agent) generally will not have to report it on Form 1099-S.
The 2021 American Rescue Plan retroactively offered an exclusion of $10,200 on unemployment income for 2020 tax returns only. While this exclusion does not translate to a dollar-for-dollar refund, the exclusion may have adjusted your return resulting in an increased tax refund.
Key Takeaways for 1099 Employees
Use employment verification letters, pay stubs, tax returns, and bank statements as proof of income. Request employment verification letters from your clients or companies you've worked for.
The 1099 form is used to report non-employment income to the Internal Revenue Service (IRS). Businesses are typically required to issue a 1099 form to a taxpayer (other than a corporation) who has received at least $600 or more in non-employment income during the tax year.
Taxpayers should first contact the employer, payer or issuing agency directly for copies. Taxpayers who haven't received a W-2 or Form 1099 should contact the employer, payer or issuing agency and request a copy of the missing document or a corrected document.
Filing your taxes without 1099 is okay as long as you pay the right amount of tax and report your income. This is because, even though you might not receive the form 1099, the IRS probably will and if you do not declare it along with your income tax, you will incur some penalties.
If you fail to file your 1099 by the due date, you may be subject to a late filing penalty. The penalty applies if you fail to file timely, or did not include all the required information, or provided incorrect information.
Generally speaking, self-employment income not reported on a 1099-NEC, 1099-MISC, or 1099-K form will be reported on the Other Income and Returns Expense page of the Business Income (Schedule C) portion of the software.
For tax year 2025, the threshold is $2,500, regardless of the number of transactions. For tax year 2026 and after, the threshold is $600, regardless of the number of transactions.
Proof of income for self-employed individuals includes 1099 forms, profit and loss statements, and bank statements. Previous year's federal tax return and self-created pay stubs can also serve as proof of income. Accurate record-keeping is crucial for establishing credibility, especially with irregular income.