On this page
Two information-return rules that affect almost every freelancer changed under the 2025 tax law (Public Law 119-21, often called the One Big Beautiful Bill Act). Starting with payments made in 2026, clients send a Form 1099-NEC only once they pay you $2,000 or more, not $600. Payment apps and marketplaces send a Form 1099-K only above $20,000 and 200 transactions.
Fewer forms doesn’t mean less taxable income. Here’s what changed and what it means for you.
In short: For 2026 payments the 1099-NEC threshold is $2,000 and the 1099-K threshold is back to $20,000 and 200 transactions. What it means for freelancers.
Form 1099-NEC: $600 becomes $2,000
Businesses use Form 1099-NEC to report payments to non-employees for services. According to the IRS, the reporting threshold is $600 for payments made before 2026 and $2,000 for payments made in 2026, with inflation adjustments after that.
| Payments made in | 1099-NEC required when a payer pays you |
|---|---|
| 2025 and earlier | $600 or more for the year |
| 2026 | $2,000 or more for the year |
| 2027 and later | $2,000 adjusted for inflation (see IRS Pub. 1099) |
In practice, a client who paid you $1,500 in 2026 may not send a form at all.
Form 1099-K: back to $20,000 and 200 transactions
Form 1099-K reports payments you receive through payment apps and online marketplaces (“third-party settlement organizations,” or TPSOs). The IRS says the new law restored the older threshold, so a TPSO only has to file a 1099-K if your payments for goods or services exceed $20,000 and number more than 200 in the year.
A few details from the IRS 1099-K FAQs matter here:
- A platform may still send a 1099-K below the threshold.
- Payment card processors (merchant acquirers) have no minimum, so card sales can still generate a 1099-K.
- Some states have lower thresholds, so you might get a form for state purposes even under the federal limit.
The part that didn’t change: all income is taxable
These are reporting thresholds for payers. They have nothing to do with what you owe. You report all of your self-employment income on Schedule C, whether or not a form arrives, and self-employment tax applies once net earnings reach $400.
So the practical change is that your own records matter more. With fewer 1099s arriving, reconciling income from form totals won’t work anymore. Track every invoice and payout as it lands (see ways to track freelance income), and use your records, not the forms, when you file.
If you pay subcontractors
If you hire other freelancers, the higher threshold also means fewer forms to file for 2026 payments. For each contractor you pay $2,000 or more during 2026, you’d generally file a 1099-NEC. Collect a Form W-9 up front, before you know whether you’ll reach the threshold. The IRS lists the forms and thresholds on its “Am I required to file a Form 1099” page.
Forms for 2026 payments are due in early 2027. The usual January 31 deadline moves to the next business day when it falls on a weekend, as it does in 2027 (January 31 is a Sunday).
What to do now
- Keep an income log that doesn’t depend on 1099s: date, client or platform, gross amount, fees.
- Set aside tax from every payment, not just from clients who’ll send a form. The 1099 tax calculator suggests a percentage.
- If you use payment apps for both personal and business money, separate them. It keeps your records clean and makes any 1099-K easier to reconcile.
FAQ
What is the 1099-NEC threshold for 2026?
$2,000 for payments made in 2026, up from $600 for payments made before 2026.
What is the 1099-K threshold for 2026?
For payment apps and marketplaces (TPSOs), more than $20,000 in payments and more than 200 transactions. Payment card processors have no minimum, and some states use lower thresholds.
Do I have to report income if I don’t get a 1099?
Yes. All self-employment income is reportable and taxable whether or not you receive a form.
Will I still get a 1099 from a client who paid me $1,500 in 2026?
Probably not, since that’s under the $2,000 threshold, but some payers send them anyway. Either way, the $1,500 is income.