As the 2026 U.S. tax season approaches, accurate information reporting is more important than ever. The IRS requires payers, whether individuals, businesses, or financial institutions, to report various types of payments made during the year through Form 1099 series.
Among these, Form 1099-NEC and Form 1099-INT are two of the most frequently used forms, yet they serve completely different reporting purposes. Using the wrong form can result in filing errors, late penalties, and mismatched records in the IRS database.
At Form1099Online.com, an IRS-authorized 1099 e-filing platform, you can prepare, review, and file your 1099 forms securely in minutes with built-in accuracy checks and instant IRS submission.
Table of Contents
The Purpose of Each Form
What Is Form 1099-NEC?
Form 1099-NEC (Nonemployee Compensation) is used to report payments of $600 or more made to nonemployees for services performed in the course of business.
Examples include:
- Independent contractors, freelancers, and gig workers
- Attorneys paid for legal services
- Consultants or vendors providing professional services
If you run a business and hired anyone who isn’t your employee, you’ll likely need to issue them a 1099-NEC. Even if the recipient is a corporation, some types of payments such as attorney fees must still be reported.
Key Filing Facts:
- IRS Deadline: January 31, 2026
- Report on: Box 1 (Nonemployee Compensation)
- Threshold: $600 or more in a tax year
- Tax Impact: Recipients report this income on Schedule C of Form 1040; it is subject to both income and self-employment tax.
What Is Form 1099-INT?
Form 1099-INT (Interest Income) is used to report interest payments made to individuals, partnerships, or entities. Most commonly, banks, credit unions, and businesses that pay interest use this form.
You must issue Form 1099-INT if:
- You paid $10 or more in interest during the year
- You withheld any federal backup withholding, even if the total is below $10
- You paid $600 or more in specific types of interest related to trade or business
Typical Examples:
- Bank account interest
- Interest on corporate or municipal bonds
- Interest on loans or late payments
Key Filing Facts:
- IRS Deadline: January 31, 2026
- Report on: Box 1 (Interest Income) or Box 3 (U.S. Obligations)
- Threshold: $10 or more, or $600 in certain cases
- Tax Impact: Reported on Form 1040, line 2b, or Schedule B if multiple payers or large interest amounts exist.
1099-NEC vs. 1099-INT
| Feature | Form 1099-NEC | Form 1099-INT |
|---|---|---|
| Type of Income | Services by nonemployees | Interest income |
| Minimum Reporting Threshold | $600 | $10 (general), $600 for certain cases |
| Common Payers | Businesses and organizations hiring freelancers | Banks, credit unions, businesses paying interest |
| Recipients | Contractors, attorneys, vendors | Individuals, businesses receiving interest |
| IRS Deadline | January 31, 2026 | January 31, 2026 |
| Reported Box | Box 1 | Box 1 or 3 |
| Reported On Tax Return | Schedule C, Form 1040 | Form 1040 Line 2b / Schedule B |
When to Use Each Form
Use Form 1099-NEC if:
- You paid a nonemployee $600 or more for services performed
- The work was done as part of your trade or business
- You paid an attorney for legal fees, even if they’re incorporated
Use Form 1099-INT if:
- You paid $10 or more in interest during the year
- Interest was earned through bank accounts, loans, or bonds
- Federal backup withholding applied to the payment
Common Filing Errors to Avoid
- Using the wrong form: Do not report interest on 1099-NEC or contractor payments on 1099-INT
- Skipping small payments with backup withholding: Even $1 of withheld tax must be reported
- Reporting goods or rent under 1099-NEC: Use 1099-MISC for such payments instead
- Late filing: Missing the January 31 deadline can result in IRS penalties per form, increasing with delay
Reporting During the 2026 Tax Season
The IRS has continued its push for digital accuracy and timely filing in the 2026 tax year. Paper forms are being phased out for many filers, and e-filing has become the preferred method for both speed and accuracy.
By e-filing your 1099 forms:
- You get instant IRS confirmation of receipt
- You reduce the chance of data entry errors
- You automatically stay compliant with IRS FIRE System requirements
Why File Through Form1099Online.com
Form1099Online.com is an IRS-authorized 1099 e-filing platform trusted by thousands of businesses and accountants nationwide. We help filers manage multiple 1099 forms such as NEC, INT, and MISC through one secure dashboard.
Platform benefits include:
- Step-by-step guided filing process
- Automatic error validation before submission
- Secure, encrypted data storage
- Option to e-file directly with the IRS and send recipient copies electronically
Whether you’re filing one form or hundreds, Form1099Online ensures your returns are accurate, compliant, and filed on time.
Conclusion:
As the 2026 tax season unfolds, make sure your business uses the right 1099 form for each payment type.
- Form 1099-NEC = Nonemployee compensation (contractor work)
- Form 1099-INT = Interest income
Choosing correctly keeps your IRS filings accurate, prevents penalties, and ensures recipients can file their taxes smoothly.
File today at Form1099Online.com for fast, secure, and IRS-approved filing.