What is a 1099?
1099
A 1099 is an IRS information return used to report certain payments made to non-employees, contractors, vendors, and other payees during the tax year. Businesses use Form 1099 to report qualifying payments and often collect a W-9 from vendors to determine whether reporting is required.
Example: If a business pays an independent contractor $5,000 during the year, it may need to issue a Form 1099-NEC reporting those payments.
Related terms: W-9, Accounts Payable, Vendor
