1099-NEC vs 1099-MISC: What's the Difference?
The IRS split these forms in 2020. Here's which one you'll receive and what it means.
By the Easy Guides Editorial Team
Why there are two forms now
Before 2020, all non-employee compensation — freelance income, contractor payments, and miscellaneous income — was reported on the 1099-MISC. In 2020, the IRS brought back the 1099-NEC (Nonemployee Compensation) specifically for payments to independent contractors and freelancers, separating them from miscellaneous income.
If you do contract or freelance work, you now receive a 1099-NEC. The 1099-MISC still exists for other income types.
- Freelance and contractor payments
- Paid $600+ for services
- Due January 31st
- Goes on Schedule C
- Subject to self-employment tax
- Rent, royalties, prizes, awards
- Medical and healthcare payments
- Attorney payments
- Due February 28th (paper) / March 31st (e-file)
- Usually not subject to SE tax
Which one will you receive as a freelancer?
If you were paid for services as an independent contractor — writing, design, consulting, coding, photography, or any other service work — you'll receive a 1099-NEC. This is the form that triggers self-employment tax and Schedule C reporting.
You might also receive a 1099-MISC if a client reimbursed you for something unusual, paid you a prize, or made payments that don't fit the NEC category — but for most freelancers, the 1099-NEC is the form you'll deal with.
What if you received the wrong form?
If a payer accidentally sends you a 1099-MISC for freelance income that should have been on a 1099-NEC (or vice versa), contact them for a correction. The distinction matters because 1099-NEC income is subject to self-employment tax and 1099-MISC income (such as rent) generally is not.