Form 1099-MISC, Miscellaneous Information, is an IRS information return used to report certain types of payments made in the course of business or trade. While some nonemployee payments are now reported on Form 1099-NEC, the 1099-MISC still plays a critical role in reporting various other payments that don’t fit into other 1099 categories.
Let’s dive into everything you need to know about the form — who must file, how to complete it, deadlines, penalties, and important updates for the 2025 tax year.
What Is Form 1099-MISC?
Form 1099-MISC is used by businesses to report specific miscellaneous payments totaling $600 or more to individuals or unincorporated entities during the tax year. These payments are not considered wages and therefore aren’t reported on a W-2. This form ensures the IRS tracks income earned outside of formal employment.
Common payment types reported on 1099-MISC include:
- Rent
- Prizes and awards
- Medical and health care payments
- Payments to attorneys (not for services)
- Crop insurance proceeds
- Royalties (only if $10 or more)
- Fishing boat proceeds
Important Note: Nonemployee compensation (e.g., payments to freelancers or independent contractors) is now reported on Form 1099-NEC, not 1099-MISC.
Who Must File Form 1099-MISC?
You must file Form 1099-MISC if your business paid $600 or more during the calendar year to a payee in any of the following categories:
- Rents, such as office space or equipment
- Prizes and awards
- Medical and healthcare payments (to doctors, clinics, etc.)
- Payments to an attorney, such as legal settlements (not fees for legal services, which go on 1099-NEC)
- Crop insurance proceeds
- Fishing boat proceeds
- Other income payments
Entities typically required to file include:
- Small businesses
- Partnerships
- Corporations (excluding some payments to incorporated entities)
- Nonprofit organizations
- Federal, state, or local government agencies
Exceptions: Personal payments (i.e., not in the course of business or trade) and payments made via credit card or third-party networks (reported on Form 1099-K) are not reported on 1099-MISC.
When Is the Deadline to File Form 1099-MISC?
Filing deadlines vary depending on the method and recipient:
| Type | Deadline |
| Recipient Copy (Copy B) | January 31, 2026 |
| Paper Filing to IRS | February 28, 2026 |
| E-filing to IRS | March 31, 2026 |
Note: If any date falls on a weekend or legal holiday, the due date moves to the next business day.
How to Complete Form 1099-MISC
Filling out Form 1099-MISC requires accurate information about the payer, recipient, and payment types. Each form contains several boxes, and only those relevant to your situation need to be completed.
Form 1099-MISC Box-by-Box Breakdown
Box 1 – Rents
Report payments of $600 or more for office rent, machinery, land, etc.
Box 2 – Royalties
Use this box for royalty payments of $10 or more, including payments for natural resources or intellectual properties.
Box 3 – Other Income
Miscellaneous income that doesn’t fall into other categories, like punitive damages, prizes, or awards.
Box 4 – Federal Income Tax Withheld
If backup withholding was required, report the amount withheld here.
Box 5 – Fishing Boat Proceeds
Used for proceeds paid to crew members on fishing boats.
Box 6 – Medical and Health Care Payments
Report $600 or more paid to medical service providers, such as physicians or hospitals.
Box 7 – Direct Sales of $5,000 or More
Check this box if you sold consumer goods worth $5,000 or more for resale.
Box 8 – Substitute Payments in Lieu of Dividends or Interest
Payments from brokers instead of actual dividends or interest.
Box 9 – Crop Insurance Proceeds
Used to report payments from insurance companies to farmers.
Box 10 – Gross Proceeds Paid to an Attorney
This box is used for payments (not service fees) such as legal settlements made to attorneys.
Box 11 – Fish Purchased for Resale
Total amount paid to sellers of fish for resale purposes.
Box 12 – Section 409A Deferrals
This is for deferrals of compensation under Section 409A plans.
Box 13 – FATCA Filing Requirement
Check this box if the Foreign Account Tax Compliance Act applies to the recipient.
Box 14 – 2025 Update: Reserved for Future Use
Previously used to report Excess golden parachute payments, Box 14 has been reassigned as “Reserved for future use” in the 2025 draft. These payments should now be reported on Form 1099-NEC.
2025 Draft Form 1099-MISC Update
Per the IRS 2025 draft:
- Box 14 has been cleared of “Excess golden parachute payments.”
- These payments must now be reported on Form 1099-NEC, Box 3.
Businesses should be aware of this shift and review their payment categories to file accurately under the new format.
Copies of Form 1099-MISC
When you issue a Form 1099-MISC, you must provide multiple copies:
| Copy | Sent To |
| Copy A | IRS |
| Copy 1 | State Tax Department (if applicable) |
| Copy B | Recipient |
| Copy 2 | Recipient (to file with state return) |
| Copy C | Retained by the payer (your records) |
Each copy must be completed correctly to avoid errors and penalties.
How to File Form 1099-MISC
You can file the form using either method:
1. Paper Filing
- Use red-ink scannable Copy A.
- Send with Form 1096, the Annual Summary and Transmittal of U.S. Information Returns.
- Suitable if filing fewer than 10 forms.
2. E-Filing
- Mandatory if filing 10 or more information returns (combined total of all 1099s).
- Use the FIRE (Filing Information Returns Electronically) system via IRS.
- Quicker and more efficient.
You can use tax software, authorized e-file providers, or hire a payroll service provider for filing.
What Are the Penalties for Not Filing Form 1099-MISC?
The IRS imposes penalties based on how late the filing is and whether the failure was intentional.
| Filing Status | Penalty Per Form (2025) | Maximum Annual Penalty |
| ≤ 30 days late | $60 | $630,500 ($220,500 for small businesses) |
| 31 days – Aug 1 | $120 | $1,891,500 ($630,500 for small businesses) |
| After Aug 1 or not filed | $310 | $3,783,000 ($1,261,000 for small businesses) |
| Intentional disregard | $630+ | No limit |
Common reasons for penalties:
- Not providing Copy B to the recipient
- Filing incorrect or incomplete information
- Filing with the wrong format (e.g., not using scannable Copy A)
Extension to File Form 1099-MISC
You can request a 30-day extension to file 1099-MISC with the IRS by submitting Form 8809 — “Application for Extension of Time to File Information Returns.”
Key notes:
- File Form 8809 on or before the due date.
- Extensions do not apply to furnishing Copy B to recipients.
- No explanation is required for the initial extension, but a second extension (rarely granted) needs justification.
If you need an extension to furnish the recipient copy, you may request it in writing under certain circumstances — like illness, natural disaster, or other hardships.
Final Thoughts
While the 1099-MISC may have lost some of its responsibilities to the newer 1099-NEC, it remains a vital part of IRS compliance for various payment types. Understanding how to file accurately, on time, and according to the most current IRS instructions helps you stay penalty-free and audit-ready.
For the 2025 tax year, remember: Box 14 is now reserved — keep golden parachute payments on your radar but report them correctly on the 1099-NEC instead.
