Form 1099-K and Forms 1099-NEC & MISC Updates

Form 1099-K is issued for payments received for goods or services during a year from credit, debit, or stored value cards and from payment apps or online marketplaces.

The threshold for 2025 was set to be $2,500, creating what many thought to be a burden on businesses.  The OBBB has modified this requirement so that the forms are only required to be issued to recipients if the amount of such transactions exceeds $20,000 and the aggregate number of such transactions exceeds 200.  This new threshold is effective for the calendar year ending December 31, 2025.

Forms 1099-NEC & 1099-MISC are issued by businesses to someone who is not an employee to report payments for services, rent, and other income items (see form instructions for a full list) over a total of $600.  Dashing the hopes of most who work on issuing 1099s, the threshold for 2025 is unchanged at $600 but will increase to $2,000 for payments made after December 31, 2025.  This new threshold also applies to backup withholding requirements.  The threshold will be increased by a cost-of-living adjustment or at least $100 starting in 2027.

Please contact your Boyum advisor with any questions.

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