Is 1099 season sneaking up on you again?
If you pay freelancers, contractors or landlords, your small business is required to issue 1099s. And every year, many owners procrastinate until the very end. After all, they’re “only”… forms.
Here’s the problem:
IRS rules changed drastically. File electronically. Majority are required. The old way of filing is ending. Penalties stack up quickly if you mess up.
Paper 1099s are on their way out.
The best part? E-filing is easy. Choose the correct 1099 e-filing program and you can complete everything in one afternoon.
Here’s how to do it…
What Is 1099 E-Filing?
1099 e-filing refers to the act of submitting your 1099 forms to the IRS through the Internet rather than sending in physical copies.
You provide payment information for each contractor and the software validates it, then files it directly to the IRS. Most programs will also provide (or print) a copy for each individual that you paid.
That’s it.
Quality 1099 e-filing software does three things for you — prepares the forms, uploads to the IRS, and saves recipient copies. No more forms with red ink scribbles all over them. No more trips to the post office. And no more wondering if the IRS actually received your forms. You can find out more about how an easy W-2 and 1099 e-filing program manages all three steps, from start to finish.
Pretty simple, right?
Why E-Filing Matters More Than Ever?
Only larger companies needed to e-file a few years back. The rest could use paper.
Not anymore.
The IRS has lowered the limit to 10 total returns — which includes all of your forms combined.
Think about it:
If you mail out 6x 1099-NECs and 4x W-2s, you’ve made it to 10. You are required to e-file. That nets a LOT of small businesses.
And here’s the kicker…
Beginning with tax years after 2025, the reporting threshold for most 1099 payments increased from $600 to $2,000. You may have fewer forms to send as a result. Sounds like a win-win!
Late returns, inaccurate returns and paper returns filed when you should have e-filed all trigger IRS penalties. For returns due in 2026, filing after August 1 can result in penalties of up to $340 per return.
Ten forms. $340 each. You do the math.
FYI, the IRS is sun-setting their legacy FIRE filing system. November 19, 2026 is the final day you’ll be able to file through FIRE. After that date, IRIS will be the only method for directly e-filing with the IRS. If you have previously filed through FIRE, you will need to make adjustments prior to next season.
The 6x Step 1099 E-Filing Walkthrough
This is it. Easy peasy steps that can be repeated. Just follow along and you’ll be covered.
Collect Your W-9s
Prior to filing, you must obtain a Form W-9 from each contractor you paid. It provides you with their:
- Legal name
- Address
- Taxpayer ID number (SSN or EIN)
Obtain your W-9s ahead of time, before you write that first check. Don’t have to hassle contractors in January.
Add Up What You Paid
Then, export a report from your accounting software and sum how much you paid each individual for the year.
Any person or organization to whom you paid $2,000 or more (2026 tax year) must be reported on a 1099-NEC. Rental payments, prizes, and some other payments are reported on a 1099-MISC.
Keep it simple. One row per contractor.
Pick Your 1099 E-Filing Software
You have two main choices:
- IRS IRIS portal: Free and allows up to 100 returns to be filed at once. You must request access, though you still need to forward copies to the recipient.
- Third-party 1099 e-file software: You submit your data and it files with the IRS (and recipient copies and frequently state) for you.
For most small business owners, option #2 wins.
Enter Or Import Your Data
Now load your contractor details into the tool.
The quickest way is to:
- Export your contractor list as a .CSV file
- Match the columns to the software’s template
- Upload the file
- Check that every row came through
Review Before You Hit Send
This is the step most people rush… Don’t.
Check each form for:
- Names that match the W-9 exactly
- The right TIN
- The right dollar amount in the right box
Reporting an incorrect TIN is among the top causes for IRS notices. Takes 2x minutes to fix now, weeks to fix later.
File And Send Copies
Hit submit and your 1099s go to the IRS. Save the confirmation.
Deliver a copy of the completed Form 1099-NEC to each contractor no later than January 31 (or by the following business day if the 31st falls on a weekend). You must also file the 1099-NEC with the IRS by January 31. Don’t wait until the last minute.
That’s the whole process!
How To Pick The Right 1099 E-Filing Software?
Truthfully, any tool will work. However there are some features that make life MUCH easier. Seek out:
- IRIS-ready filing: With the elimination of FIRE, please ensure that software is IRIS-ready (already files through IRIS).
- Recipient delivery: The top tools deliver emails or physical mail copies directly to your contractors.
- Error checks: Detect missing TINs and invalid amounts prior to transmission to the IRS.
- State filing: Some states require a copy be sent to them. Quality software will do this automatically.
- Corrections: Oops! Made an error? You can quickly e-file a corrected 1099.
If the software costs per form, compare pricing on ALL of your forms — not just the cost of the first form.
Bonus: Many of these tools manage W-2s too. If you have employees take care of everything in one place and avoid logging in twice.
Closing The Books On 1099 Season
E-filing 1099s isn’t something to fear. It’s a simple process that saves you:
- Time — no printing, no envelopes, no post office.
- Money — fewer mistakes means fewer penalties.
- Stress — you get proof the IRS received your forms.
To quickly recap:
- Collect W-9s before you pay anyone
- Add up what each contractor was paid
- Pick your 1099 e-filing software
- Upload and review your data
- File with the IRS and send copies by January 31
Rinse and repeat next year.
Frequently Asked Questions
Does a small business have to e-file 1099s?
Yes. You must e-file if the business submits 10 or more information returns for the year. W-2s count as information returns. You can still file paper returns if you submit less than 10 – but e-filed returns are faster and more secure.
When are 1099-NEC forms due?
Form 1099-NEC is owed to the IRS and your contractors by January 31. If January 31 falls on a Saturday or holiday, you have until the following business day.
Can you e-file 1099s for free?
Yes, you can via the IRS IRIS portal. However, you must request access first and you will still have to forward copies to contractors yourself.
