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Decoding 1099-NEC Copy Requirements

1099-NEC ‘Copies’, or parts, report non-employee compensation to recipients and government agencies and help ensure accuracy of income tax filing. They include identical information about the payer and recipient, payments and withholdings, but each copy is given to a different entity.

1099-NEC Forms are filled out by the payer and provided to the recipient or a government agency.

Each recipient receives multiple copies of their 1099-NEC. One is filed with their federal income tax return and if required, one is filed with their state return or kept as a copy for their records.

The Payer files 1099-NEC forms with the federal government, plus state and/or local tax agencies if needed. A copy is retained for their business records as well.

Not all states or cities require a 1099-NEC filed by the payer. Some just use the federal information. See which states require a 1099-NEC later in this post.

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1099-NEC Form Copy	3-Part (federal only)	4-Part (federal & state)	5-Part (fed, state & local)
Payer Copies
1099-MISC Copy A (file to Federal Government)	X	X	X
1099-MISC Copy C-2 (payer state or file copy)	X
Recipient Copies
1099-MISC Copy B (file with Federal tax return)	X	X	X
1099-MISC Copy 2 (file with State/Local tax return or keep for files)		X	X

1099-NEC Must be Filed with these States

Alabama, Arkansas, California, Colorado, Connecticut, Delaware, District of Columbia, Georgia, Hawaii, Idaho, Kansas, Kentucky, Maine, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Jersey, New Mexico, North Carolina, North Dakota, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, Utah, Vermont, Virginia, West Virginia, Wisconsin

Don’t forget to file a 1096 Summary and Transmittal with each Payer’s bath of 1099s.

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Read About Decoding W-2 Copy Requirements>