Updated June 16, 2026 · 5 min read
If you did freelance or contract work, you'll get a 1099-NEC — it reports nonemployee compensation, the money a business paid you for services. The 1099-MISC is for *other* kinds of income: rent, royalties, prizes, awards, and certain legal or medical payments. Since 2020, contractor pay moved off the 1099-MISC and onto its own form, the 1099-NEC. Both mean the same thing for your wallet: it's taxable income the IRS already knows about.
| 1099-NEC | 1099-MISC | |
|---|---|---|
| What it reports | Pay for services (nonemployee compensation) | Rent, royalties, prizes, other income |
| Who gets it | Freelancers, gig workers, independent contractors | Landlords, royalty earners, prize winners |
| Reporting threshold | $600+ from a payer | $600+ (rent/other); $10+ for royalties |
| Subject to self-employment tax? | Yes — it's business income | Usually no (it's not pay for services) |
| Where it lands on your return | Schedule C → Schedule SE | Usually Schedule E or other income |
A business that paid you $600 or more for services during the year must send you a 1099-NEC by January 31. This is the form for DoorDash drivers, Uber/Lyft drivers, freelancers, consultants, and any independent contractor. The income goes on Schedule C as business income, and because it's pay for your work, it's subject to self-employment tax (15.3%) on top of regular income tax.
The 1099-MISC catches income that isn't wages and isn't pay for services: rent you collected, royalties, prize and award money, and some legal settlements or medical payments. Most 1099-MISC income is *not* subject to self-employment tax because you didn't perform a service for it — for example, rental income generally goes on Schedule E instead of Schedule C.
You still owe the tax. Payers only have to issue a 1099 at $600 (or $10 for royalties), but all income is taxable whether or not a form was sent. If you earned $400 from one client and $300 from another, you may get no 1099s — yet you must report the full $700. The IRS gets copies of every 1099 filed, so reported income that doesn't match triggers notices.
A 1099-NEC reports nonemployee compensation — money you were paid for services as a freelancer or contractor. A 1099-MISC reports other income like rent, royalties, prizes, and awards. Contractor pay moved from the 1099-MISC to the new 1099-NEC starting in tax year 2020.
Yes. 1099-NEC income is pay for your work, so it's business income subject to the 15.3% self-employment tax plus regular income tax. Most 1099-MISC income (like rent) is not subject to self-employment tax.
Because you were paid for services as a contractor. Since 2020, the IRS uses the 1099-NEC specifically for nonemployee compensation, while the 1099-MISC is reserved for rent, royalties, and other non-service income.
A payer must issue a 1099-NEC or 1099-MISC if they paid you $600 or more during the year ($10 for royalties). But you owe tax on all income even if it falls below the threshold and no form is issued.
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