Monday, 15 June 2026 08:00 AM
Company Update
Under the One Big Beautiful Bill Act Signed in July 2025, the Long-Standing $600 Reporting Threshold for Form 1099-NEC and 1099-MISC Rises to $2,000 – But Underlying Income Tax Obligations Don’t Change
IRVINE, CA / ACCESS Newswire / June 15, 2026 / For the first time in decades, the federal reporting threshold for Form 1099-NEC and Form 1099-MISC has been raised. Beginning in 2026, businesses are required to issue these forms only when payments to a contractor or service provider exceed $2,000 in a calendar year - up from the previous $600 threshold. The change, enacted under the One Big Beautiful Bill Act, will reduce paperwork for many small businesses, but it has a quiet side effect: contractors will receive fewer 1099s, even though their underlying tax obligation is unchanged.
"The threshold change is being marketed as paperwork relief, and for small businesses it is," said a spokesperson for Clear Start Tax, a national tax relief and resolution firm. "But for contractors and gig workers, the absence of a 1099 in the mail does not change what they owe. Income is taxable whether or not it triggers a form."
Under the new rule, a business that pays a contractor $1,800 in 2026 is no longer required to issue a 1099-NEC, even though the contractor must still report and pay tax on that income. The risk is that taxpayers who previously used the arrival of a 1099 as their cue to report income may now under-report - either through oversight or through the false assumption that no form means no obligation. The IRS continues to require all income to be reported, and matching technology can still identify discrepancies between bank deposits and reported earnings.
"Self-employed taxpayers and gig workers have always carried more reporting responsibility than W-2 employees," the spokesperson added. "This change increases that. The taxpayer is now more responsible than ever for tracking and reporting income that may never appear on an information return."
For contractors and small businesses affected by the new threshold, Clear Start Tax recommends:
Track all payments received during the year, regardless of whether a 1099 is issued
Reconcile bank deposits against invoiced revenue at year-end to confirm full reporting
Continue setting aside estimated taxes on self-employment income, even on payments under the new threshold
Consult a tax professional if multiple income streams cross or approach the $2,000 threshold
By answering a few simple questions, taxpayers can find out if they're eligible for the IRS Fresh Start Program and take the first step toward resolving their tax debt.
"The threshold changes; the obligation does not," the spokesperson said. "Contractors who treat 1099s as the only record of their income will catch the IRS's attention faster than ones who keep their own books."
About Clear Start Tax
Clear Start Tax is a nationwide tax resolution and relief firm specializing in helping individuals and businesses address IRS and state tax issues. With a team of experienced tax professionals, the company provides tailored strategies for resolving back taxes, negotiating settlements, and achieving long-term compliance.
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https://clearstarttax.com/qualifytoday/
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Contact Information
Clear Start Tax
Corporate Communications Department
[email protected]
(949) 800-4011
SOURCE: Clear Start Tax