Freelancers can receive two different 1099 forms for the same kind of work. They come from different payers, have different thresholds, and are easy to double-count. Here is how they differ and how to handle them.
Form 1099-NEC: paid directly by a business
A business that pays you for services — as a non-employee — reports it on Form 1099-NEC (“nonemployee compensation”). For payments made in 2026, a business generally files one when it pays you $2,000 or more during the year. That threshold was $600 for decades; a 2025 law raised it, and it will be indexed for inflation after 2026.
Before paying you, a client will usually ask for a Form W-9 with your name and taxpayer identification number (your SSN, or an EIN if you have one).
Form 1099-K: paid through an app or marketplace
Payment apps, online marketplaces and card processors report payments they process for you on Form 1099-K. For payment apps and marketplaces, the federal threshold is gross payments of more than $20,000 and more than 200 transactions in the year. Some platforms send forms below that, and some states require lower thresholds, so you may still get one.
Side by side
| 1099-NEC | 1099-K | |
|---|---|---|
| Sent by | The business that hired you | The app, marketplace or card processor |
| Federal threshold (2026) | $2,000+ | Over $20,000 and over 200 transactions (apps/marketplaces) |
| Amount shown | What the client paid you | Gross payments processed — before fees, refunds or shipping |
Avoid double-reporting
A client who pays you through a payment app should not also send a 1099-NEC for those payments; the app reports them on a 1099-K instead. Mistakes happen, though. If the same income shows up on both forms, report it once and keep records that show the overlap.
The 1099-K shows gross, not profit
Because a 1099-K shows gross amounts, it can be bigger than what you actually earned. Platform fees, refunds and shipping costs are deducted as business expenses on Schedule C. And if a 1099-K includes money that was not income at all — splitting a dinner bill or selling a personal item at a loss — you do not owe tax on it; the IRS explains how to report and back out those amounts in its Form 1099-K guidance.
No form? Still taxable
The thresholds only control whether the payer must file a form. Every dollar of business income is reportable whether or not a 1099 arrives. Keep your own record of payments from every client and platform, and compare it with the forms you receive in January.
What to do with the forms
- Total your business income from your own records.
- Check it against every 1099-NEC and 1099-K you receive.
- Report gross income and expenses on Schedule C.
- Pay self-employment tax on the profit with Schedule SE — see the self-employment tax calculator.