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What is a 1099?

A 1099 is an IRS information return that reports money paid to you that was not wages.

The common ones. A 1099-NEC reports pay to a contractor. A 1099-MISC covers rents and some other income. A 1099-INT and 1099-DIV report interest and dividends. A 1099-K reports payments through cards and payment apps.

Who gets a copy. The payer sends one copy to you and one to the IRS, early in the year after you were paid.

What you do with it. Report the income on your tax return. Contractor income usually goes on Schedule C, with self-employment tax on Schedule SE. Tax is rarely withheld, so you may need to make estimated tax payments.

If you pay contractors. Collect a Form W-9 before you pay, and you may need to send a 1099-NEC after the year ends. The IRS sets the threshold and the deadline each year.