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Five things about US 1099 filing changed for tax year 2026, and a bookkeeper who follows last year's $600 rule will file the wrong forms in January 2027.
The One Big Beautiful Bill Act, signed in July 2025, raised the reporting threshold for Form 1099-NEC and most Form 1099-MISC payments from $600 to $2,000 for payments made on or after 1 January 2026. The threshold is indexed for inflation from 2027. That single change makes almost every article, template and chatbot answer written before mid-2025 wrong for the filing season you are about to work.
Here is the part that costs money, and the part nobody writes about. Federal relief did not release the states. Mississippi and Wisconsin codified $600 and have not amended it. Missouri sits at $1,200. Arkansas requires filing at $2,500 when no state tax was withheld. California did adopt $2,000 for tax year 2026. So a Mississippi business that pays a designer $900 in 2026 owes no federal 1099 at all - and still owes the state copy. If you sweep every vendor under $2,000 off the list because the federal number went up, you have just created a state filing failure for each one.
Three more traps sit in the same list.
The payment app already filed it. If you paid the contractor by credit card, PayPal or Venmo, the processor reports the payment on Form 1099-K; the federal 1099-K threshold went back to $20,000 and 200 transactions under the same Act. Issuing a 1099-NEC on top of that double-reports your contractor's income and lands them a notice.
Royalties never moved. Box 2 of Form 1099-MISC has a $10 threshold and was not part of the change. A $40 royalty is still reportable.
31 January 2027 is a Sunday. Tax-year-2026 recipient and IRS copies of the 1099-NEC are therefore due Monday 1 February 2027. The 1099-MISC IRS copy is separate again: paper by Monday 1 March 2027, e-file by Wednesday 31 March 2027. And if you are filing ten or more information returns of all types combined, paper is not an option - that is the IRIS e-file mandate, and paper filing is itself penalized.
What does getting it wrong cost? For returns filed in 2026 the tiers are $60 per form within 30 days, $130 through 1 August, $340 after that, and $680 for intentional disregard with no annual cap. The same amount can be charged again for the recipient copy under section 6722. Twelve contractors filed late at the top tier is $4,080. Separately, if you have no signed W-9 with a valid TIN, you were required to withhold 24% of the payment - and if you paid it out gross, that 24% is your liability, not the contractor's.
The extension is a Chrome, Edge and Firefox popup that answers one payment at a time: tax year, amount, what the payment was for, who you paid, how you paid, and your state. It returns the verdict, the form and box, the federal threshold for that year, your state's separate threshold, both deadlines with the weekend shift already applied, the e-file mandate, the backup-withholding figure and the penalty exposure. There is also a free web page that runs the same code, with no install.
Every calculation is free - no key, no limit, no watermark, nothing hidden behind a signup. The paid version adds one thing on a different axis: you can download the finished check as a .csv and keep it in the contractor's file, so an auditor can see the inputs and the answer and why you did or did not file. For comparison, a CPA charges around $150 to prepare a year's 1099s plus roughly $30 per form and $35 for the 1096 - twelve contractors runs to about $545.
Questions people ask
What does this extension actually do?
It answers one question about one contractor payment: do you have to file a 1099 for it. You enter the tax year, the amount, what the payment was for, who you paid, how you paid and your state, and it returns the form and box, the federal threshold for that year, your state's separate threshold, both deadlines, the e-file mandate, the backup-withholding figure and the penalty exposure.
Who is this for?
US bookkeepers, small-business owners and one-person CPA practices who sit down in January with a vendor list and have to decide, line by line, which contractors get a 1099. It is aimed at the person doing the filing, not at a tax adviser researching the statute.
Why can't I just ask a free chatbot or read a blog post?
Because most of them still answer $600. That figure was correct through tax year 2025 and became wrong for payments made from 1 January 2026, when the One Big Beautiful Bill Act raised the threshold to $2,000. They also miss that Mississippi and Wisconsin never moved off $600, that Missouri sits at $1,200 and Arkansas at $2,500.
What is free and what does the paid version add?
Every calculation is free, with no key, no limit, no watermark and nothing hidden behind a signup. The paid version adds one thing on a different axis: you can download the finished check as a .csv and keep it. Free answers the question; paid lets you take the answer away as a record for the file.
What would this cost me if I paid someone to do it?
A CPA typically charges around $150 to prepare a year's 1099s, plus about $30 per form and $35 for the 1096, so twelve contractors runs to roughly $545. A single missed form costs $340 at the top penalty tier for returns filed in 2026, and $680 if the IRS treats the omission as intentional disregard.
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