If you paid a handyman, plumber, electrician, or any other contractor $600 or more during the tax year for work on your rental properties, the IRS expects you to file a 1099-NEC. Many landlords do not know this — and the penalties for not filing can add up quickly. Here is exactly what you need to know about 1099 requirements as a landlord.

Who Needs to Receive a 1099-NEC

You must issue a 1099-NEC to any individual, sole proprietor, partnership, or LLC (taxed as a sole proprietor or partnership) that you paid $600 or more during the tax year for services related to your rental properties. This includes handymen, plumbers, electricians, painters, landscapers, cleaning crews, property managers, and any other service provider who is not your employee.

You do NOT need to issue a 1099-NEC to: corporations (C-corps or S-corps), contractors you paid less than $600 total for the year, or companies you paid via credit card or third-party payment processor — those payments are reported by the payment processor on a 1099-K instead.

How to Determine If a Contractor Is a Corporation

When you hire a contractor, have them fill out IRS Form W-9 before you pay them. The W-9 tells you their legal name, tax ID number, and entity type. If the W-9 shows they are a C-corp or S-corp, you do not need to issue a 1099. If they are an individual, sole proprietor, partnership, or single-member LLC, you do. Getting the W-9 upfront is the most important step.

Deadlines and Filing

The 1099-NEC must be provided to the contractor AND filed with the IRS by January 31 of the following year. There is no automatic extension. You can file electronically through the IRS FIRE system, through tax software, or through your accountant. For 10 or more forms, electronic filing is required.

Penalties for Not Filing

Penalties for late or missing 1099-NEC forms are: $60 per form if filed within 30 days of the deadline, $120 per form if filed between 30 days late and August 1, $310 per form if filed after August 1 or not filed at all, and $630 per form for intentional disregard.

Practical System for Landlords

Collect a W-9 from every new contractor before their first payment. Track all contractor payments by vendor throughout the year. In early January, identify anyone who received $600 or more and is not a corporation. File 1099-NEC forms by January 31. Keep copies for at least 4 years.

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Frequently Asked Questions

Do landlords have to send 1099s to contractors?

Yes, if you paid an unincorporated contractor $600 or more during the tax year, you must file a 1099-NEC with the IRS and give a copy to the contractor.

What is the 1099 deadline for landlords?

The 1099-NEC must be provided to the contractor by January 31 of the following year and filed with the IRS by January 31 as well.