Form 1099-NEC Explained: Complete Guide for Gig Workers
Form 1099-NEC is one of the most important tax documents for gig workers. This form reports your earnings as an independent contractor and is used by the IRS to verify that you're reporting all your income. Understanding how to read and use this form is essential for accurate tax filing.
This guide explains everything you need to know about Form 1099-NEC in 2026: what it is, when you receive it, how to read it, what to do if it's wrong, and how to report it on your tax return.
What is Form 1099-NEC?
Form 1099-NEC (Nonemployee Compensation) is an IRS tax form used to report payments made to independent contractors, freelancers, and gig workers. It replaced Box 7 of the old 1099-MISC form starting in 2020.
Key Facts About 1099-NEC
- Purpose: Reports income paid to nonemployees (independent contractors)
- Threshold: Issued if you earned $600 or more during the year
- Deadline: Companies must send by January 31
- Copies: You receive Copy B; IRS receives Copy A
- Who sends it: Gig platforms, clients, anyone who paid you for services
?? Important Note
Even if you don't receive a 1099-NEC (because you earned less than $600), you're still required to report ALL income to the IRS. The $600 threshold is just for when companies must send the formnot when you must report income.
Who Receives Form 1099-NEC?
You'll receive Form 1099-NEC if you worked as an independent contractor and earned $600 or more from a single payer during the year. Common gig workers who receive 1099-NEC forms include:
Rideshare & Delivery
- Uber drivers
- Lyft drivers
- DoorDash dashers
- Instacart shoppers
- Uber Eats couriers
- Grubhub drivers
- Postmates couriers
Freelancers & Others
- Upwork freelancers
- Fiverr sellers
- Freelancer.com workers
- TaskRabbit taskers
- Independent consultants
- Contract workers
- Self-employed professionals
How to Read Form 1099-NEC
Form 1099-NEC is a simple one-page form. Here's what each section means:
Payer Information (Top Left)
Shows the company or person who paid you:
- Payer's name (e.g., "Uber Technologies Inc.")
- Payer's address
- Payer's TIN (Tax Identification Number)
Recipient Information (Top Right)
Shows your information:
- Your name
- Your address
- Your SSN or EIN
Important: Verify this information is correct. Errors can delay your refund.
Box 1: Nonemployee Compensation (Most Important!)
This is the key numberyour total earnings for the year. This amount represents:
- Gross income from the platform
- Usually AFTER platform fees are deducted
- Includes tips, bonuses, and incentives
Example: If Box 1 shows $35,420.50, that's what you report as income on Schedule C before deducting business expenses.
Box 2: Payer Made Direct Sales (Usually Blank)
This box is checked if the payer sold $5,000+ of consumer products to you for resale. This rarely applies to gig workers and is usually blank.
Box 4: Federal Income Tax Withheld (Usually Blank)
Shows federal tax withheld. This is almost always blank for gig workers because platforms don't withhold taxes. If it has an amount, you can claim it as a credit on your tax return.
Box 5: State Tax Withheld (Usually Blank)
Shows state tax withheld. Also usually blank for gig workers.
1099-NEC vs. 1099-K: What's the Difference?
Some gig workers receive both Form 1099-NEC and Form 1099-K from the same platform. It's important to understand the difference to avoid double-counting income.
Form 1099-NEC
- Reports: Nonemployee compensation
- Amount: Net earnings (after platform fees)
- Threshold: $600+
- Example: Uber pays you $35,000 after taking their 25% commission
- Use this for: Schedule C income reporting
Form 1099-K
- Reports: Payment card transactions
- Amount: Gross payments (before platform fees)
- Threshold: $600+ (as of 2024)
- Example: Total customer payments of $46,667 before Uber's cut
- Use this for: Reconciliation only (don't report both!)
?? Don't Double-Count Income!
If you receive both forms, use the 1099-NEC amount on Schedule C. The 1099-K shows gross payments before fees, while 1099-NEC shows your actual earnings.
Learn more in our 1099-K guide.
What to Do When You Receive Your 1099-NEC
Step 1: Verify the Information
Check that all information is correct:
- Your name matches your tax return
- Your SSN/EIN is correct
- Your address is current
- The amount in Box 1 matches your records
Step 2: Compare to Your Records
Cross-check the 1099-NEC amount with your own records (bank deposits, platform earnings summaries). If there's a discrepancy, contact the platform immediately.
Step 3: Save the Form
Keep Copy B for your records. You'll need it when filing your tax return. Store it with other tax documents for at least 3 years (7 years is safer).
Step 4: Report on Schedule C
When filing taxes, report the Box 1 amount on Schedule C, Line 1 (Gross receipts or sales). If you have multiple 1099-NEC forms, add them together.
See our Schedule C guide for detailed instructions.
What If Your 1099-NEC Is Wrong?
Errors on 1099-NEC forms are common. Here's what to do if you spot a mistake:
1. Contact the Issuer Immediately
Reach out to the platform's support team as soon as you notice the error. Request a corrected 1099-NEC (called a "1099-NEC-C").
Tip: Do this as soon as you receive the formdon't wait until tax filing deadline.
2. Document Everything
Keep records of your communication with the platform, including emails, support tickets, and your own earnings records (bank statements, platform summaries).
3. File With the Correct Amount
If you can't get a corrected form before the tax deadline, file your return with the correct amount based on your records. Attach a statement explaining the discrepancy.
Important: Don't file with incorrect information just because that's what the 1099-NEC says. The IRS expects you to report accurate income.
4. Common Errors to Watch For
- Wrong SSN or name spelling
- Incorrect income amount (too high or too low)
- Income from wrong year
- Duplicate 1099-NEC for same income
- Missing 1099-NEC when you should have received one
What If You Don't Receive a 1099-NEC?
If You Earned Less Than $600
You won't receive a 1099-NEC if you earned less than $600 from a single payer. However, you still must report this income on Schedule C. Use your own records (bank deposits, platform earnings) to determine the amount.
If You Earned $600+ But Didn't Receive the Form
First, check your online accountmany platforms provide digital copies. If it's not there:
- Contact the platform's support for a replacement
- Check if they have your correct mailing address
- Wait until mid-February (forms can be delayed in mail)
If you still don't receive it, file your return using your own records of income. The IRS cares that you report the correct amount, not that you have the physical form.
How to Report 1099-NEC Income on Your Tax Return
1099-NEC income is reported on Schedule C (Form 1040), where you calculate your business profit or loss.
Step-by-Step Reporting
- Schedule C, Line 1: Enter the total from Box 1 of all your 1099-NEC forms
- Schedule C, Part II: Deduct business expenses (mileage, supplies, phone, etc.)
- Schedule C, Line 31: Calculate net profit (income minus expenses)
- Schedule SE: Calculate self-employment tax on net profit
- Form 1040: Transfer net profit and SE tax to main return
Example: Multiple 1099-NEC Forms
Uber 1099-NEC: $25,000
Lyft 1099-NEC: $15,000
DoorDash 1099-NEC: $10,000
Schedule C, Line 1: $50,000 (total)
Then deduct expenses to calculate net profit
For detailed filing instructions, see our complete tax filing guide.
Related Resources
How to File Taxes as a Gig Worker
Step-by-step guide to filing your tax return with 1099-NEC income.
View Filing GuideSchedule C Guide for Gig Workers
Line-by-line instructions for reporting 1099-NEC income on Schedule C.
View Schedule C GuideGig Worker Tax Deductions
Maximize deductions to reduce taxable income from your 1099-NEC.
View Deductions GuideFrequently Asked Questions
Understanding Your 1099-NEC Is Essential for Accurate Filing
Form 1099-NEC is a critical document that reports your gig worker earnings to both you and the IRS. By understanding how to read it, verify its accuracy, and report it correctly on Schedule C, you can file your taxes with confidence.
Always verify the information on your 1099-NEC when you receive it, compare it to your own records, and contact the issuer immediately if you spot errors. Remember: you must report all income, even if you don't receive a 1099-NEC. Accurate reporting protects you from IRS penalties and ensures you're paying the correct amount of tax.