How to send a 1099 to a contractor

Somewhere between your invoicing system and the payment records scattered across your bank account, you realize it’s January and you need to send 1099 forms to the IRS. The process isn’t complicated, but the details matter because the IRS expects accurate reporting and your contractors need their forms to file their taxes.

What does “sending a 1099” actually mean?

Sending a 1099 means completing two separate deliveries; you send Copy A to the IRS and Copy B to your contractor. For Form 1099-NEC, both copies are typically due by January 31. Each submission is its own legal requirement, with its own deadlines and potential penalties.

Problems usually happen when businesses only complete one step. If a contractor doesn’t receive their copy, they may not be able to file their taxes correctly. If the IRS doesn’t receive their copy on time, penalties can apply—even if the contractor was paid and informed.

Once you understand that there are two required submissions, the process becomes much more straightforward. The IRS uses 1099s to confirm contractors are reporting the income you paid them, which makes accuracy important from the start.

Start by collecting your contractors’ information

You can’t prepare accurate 1099s without key details from each contractor—and that information lives on the W-9.

The timing matters more than most businesses realize. The best time to request a W-9 is before you send the first payment. When contractors are actively working on your project, they’re far more likely to respond quickly. If you wait, they may have moved on to other clients, changed emails, or even relocated—making year-end W-9 collection much harder. By December, your request is just one more message in a crowded inbox.

You’ll need to file a 1099 once total payments to a contractor reach $600 or more during the calendar year. Smaller payments add up. For example, you wouldn’t file at $599—but if you paid $250 in March, $400 in July, and $200 in November, you would. Without clear payment tracking, it’s easy to miss when you’ve crossed the threshold, which can lead to filing mistakes.

Choose the correct 1099 form

There are two main 1099 forms—and yes, the names are confusing: 1099-NEC and 1099-MISC. Choosing the right one helps you avoid filing mistakes that can trigger follow-ups from the IRS months later.

• Form 1099-NEC: Use this form to report nonemployee compensation paid to independent contractors for services like consulting, design work, or contract labor. You’ll file this form when total payments reach $600 or more during the calendar year.
• Form 1099-MISC: Use this form to report miscellaneous income, such as rent, royalties, prizes, or awards. The same $600 threshold typically applies. This form is less common for standard contractor payments, but it’s required when payments are not tied to services.

The easiest way to decide is to ask one question: Did you pay the person for work they performed?

• If yes → File Form 1099-NEC
• If no → File Form 1099-MISC (for things like property use or rights)

If you’re still unsure, you can use the IRS form selection tool or quickly confirm with your accountant.

Prepare your 1099

Once you’ve chosen the correct form, you have two legitimate ways to move forward: using software or filing services or filing on paper. Both work, but software is usually easier to scale and helps avoid the manual issues that tend to show up in January.

File copy A with the IRS

How and when you file Copy A depends on your filing volume. If you’re filing 10 or more information returns, including 1099s and W-2s combined, you must file electronically. Paper filing is only allowed if you’re filing fewer than 10 forms. This threshold applies through 2026.

You can file electronically through the free IRS IRIS Taxpayer Portal, which works well for small or mid-size filings. Just upload your forms, and the IRS will validate and confirm them. Third-party services like Tax1099 (integrated with Melio) can e-file for you, saving you the hassle of learning IRIS. Paper filing is allowed only if you’re filing fewer than 10 forms and requires Form 1096 to send Copy A to the IRS. If you mail forms, make sure you use the correct state-specific mailing address.

For 1099-NEC, both Copy B and Copy A are due January 31. For 1099-MISC, Copy B is due January 31, while Copy A is due February 28 for paper filing or March 31 for e-filing. Missing these deadlines can lead to penalties ranging from $50 to $260 per form, depending on how late you file.

Send copy B to the contractor

Copy B must reach the contractor by January 31. You can send it by mail, hand delivery, or electronically, if the contractor gives consent ahead of time.

Many contractors prefer electronic delivery because it’s easier to store and search later. You can send Copy B digitally, but you need written consent first (an email confirmation or a checked box during W-9 collection is typically enough). Because these forms include sensitive data like SSNs and EINs, always use encryption or a secure delivery method when sending electronically. Most modern platforms handle this automatically by using secure, password-protected links.

Deadlines and thresholds

For 1099-NEC, furnish Copy B to the contractor by January 31 and file Copy A with the IRS by January 31. For 1099-MISC, furnish Copy B by January 31, file Copy A by February 28 (paper) or March 31 (e-file).

If you’re filing 10 or more information returns, you must file electronically. If you’re filing fewer than 10 forms, you can choose paper or e-file. 

Any contractor paid $600 or more in a calendar year requires a 1099. For example, if you paid five contractors earning $450, $1,200, $800, $300, and $2,000 respectively, you file 1099s for the three above $600.

How Melio simplifies the entire process

Melio simplifies sending 1099s by bringing W-9 collection and 1099 prep into one workflow. When you run this process across multiple systems, you end up doing a lot of coordination work—especially if you manage multiple contractors, different payment methods, and W-9s stored in different places.

Melio isn’t a separate compliance tool you have to remember to log into. It’s built directly into how you pay contractors.

Here’s what that looks like in practice.

Sending 1099s: Your process forward

Whether you handle 1099s manually, use accounting software, or manage everything through a dedicated payment platform, the fundamentals stay the same: collect accurate information upfront, stay consistent throughout the year, and always file before the deadline.

Melio’s integrated approach is especially helpful if you’re managing dozens of contractors and juggling multiple payment methods. When you add a vendor, the platform prompts you to request their W-9 before sending the first payment. One click sends a professional email with a secure link, where the vendor can complete the W-9 online in about two minutes. Their information is then stored automatically for future use.

The process works whether you have one contractor, five, or fifty. What matters most is choosing a system that fits your business—and using it consistently. That single decision can save hours of manual work later.

Try Melio’s 1099 management platform today.