How do I handle 1099-NEC forms I receive as a freelancer?

Form 1099-NEC (Nonemployee Compensation) is issued by any client that pays you $600 or more during the calendar year. Understanding how to correctly handle these forms is essential for accurate Schedule C filing. **What to do with a 1099-NEC:** 1. Verify the amount matches your records — errors do occur 2. Report the income on Schedule C Line 1 (gross receipts), regardless of whether the 1099 is correct 3. If a 1099 amount is wrong, contact the payer to issue a corrected 1099. Do NOT simply ignore it. 4. Include ALL freelance income — even from clients who did not issue a 1099 (all income is taxable, with or without a form) **Form 1099-K (Payment Card and Third-Party Network Transactions):** - Issued by Stripe, PayPal, Venmo, Square if you received >$5,000 in business payments in 2025 (threshold lowering from prior $20,000+ in future years) - Report 1099-K income on Schedule C as gross receipts - Do not double-count: if you received both a 1099-NEC and a 1099-K from the same client (e.g. invoice paid via PayPal), only include the income once **Mismatches:** The IRS cross-references 1099-NEC amounts with your Schedule C. If you report less gross income than the sum of your 1099s, expect an IRS CP2000 notice. **What if I don't receive a 1099-NEC?** You are still legally required to report all income. Many clients pay under the $600 threshold and do not issue forms — but the income is still taxable.

• Report all 1099-NEC income on Schedule C Line 1 — even with errors, report and reconcile
• All income is taxable — even without a 1099-NEC from the payer
• 1099-K: issued by Stripe/PayPal for >$5,000 in 2025 — do not double-count
• IRS matches 1099 totals to your Schedule C — discrepancies trigger CP2000 notices
• Contact payer for a corrected 1099 if you spot an error; do not simply omit it