1099-NEC for subcontractors in 2026

If you hire subcontractors, you may have to report what you pay them on Form 1099-NEC. The rules changed for payments made in 2026, so here is what a construction or remodeling company needs to know, in plain language.

Not tax advice. This guide is general information. Confirm your own situation with your accountant and atirs.gov.

The threshold: $600 became $2,000

The year is the date you paid, not the date the work was done. A job finished in December and paid in January belongs to the January payment year.

Collect a W-9 before you pay

Ask every subcontractor for a Form W-9 before the first payment. It gives you their legal name, address and taxpayer identification number (TIN), which you need to file the 1099-NEC. Chasing it in January is slower and harder.

Card payments are usually not yours to report

Payments made by card or through third-party networks such as PayPal are generally reported by the payment processor on Form 1099-K, not by you on Form 1099-NEC. Checks, cash, ACH and wires are generally the payments you track yourself.

Deadline for tax year 2026: February 1, 2027

Forms for tax year 2026 are due to the recipient and to the IRS by February 1, 2027. The IRS FIRE system is retired: information returns are filed through IRIS.

No valid TIN: backup withholding of 24%

When a contractor has not given you a valid TIN, backup withholding of 24% applies to what you pay them. Getting the W-9 first avoids it.

Who usually does not get a 1099-NEC

Payments to corporations are generally exempt. Attorneys are an exception. Ask your accountant how this applies to each of your subcontractors.

How RelioHub helps

RelioHub collects each contractor's W-9 electronically or on paper, lets you record the payments you make outside RelioHub, and prepares the 1099-NEC for you or your accountant to review and file. RelioHub does not move money, withhold or deposit taxes, or file with the IRS, and it covers federal forms only.See how payroll and tax forms work.

Official source:About Form 1099-NEC on irs.gov.