1099 season has followed a pretty familiar routine for years. The forms, the filing process, and even the $600 number have become second nature for many businesses.
This year, a few of those familiar pieces are changing.
January is Coming
January has a way of arriving with a stack of papers in its hands. One minute you’re wrapping up payroll, closing out the books and planning for the year ahead. Suddenly, you’re sorting through vendor lists, hunting down W-9s, and figuring out who gets what!
This year, that familiar January scramble comes with a few changes.
The longstanding $600 reporting threshold for many 1099-NEC and 1099-MISC payments is increasing, the IRS is officially saying goodbye to its FIRE filing system, and IRIS is taking center stage for electronic information returns.
The good news? A little preparation now can make 1099 season feel a lot easier when January arrives.
The $600 Rule is Getting a Major Update
For decades, $600 has been the number businesses have associated with 1099s. Beginning with payments made in 2026, that number jumps to $2,000 for many payments reported on Forms 1099-NEC and 1099-MISC.
For Form 1099-NEC, businesses will generally need to issue a form when payments for nonemployee services reach $2,000 during the year. The higher threshold also applies to several common payments reported on Form 1099-MISC, including rent, prizes and awards, other income, and medical and health care payments.
That doesn’t mean we can completely forget about the smaller thresholds, though. Some payments still play by different rules. Royalties, for example, remain subject to a $10 reporting threshold, while certain other types of payments have their own requirements.
The $2,000 threshold will also be adjusted for inflation in future years, so this is one of those numbers businesses will want to keep an eye on rather than commit to memory forever.
For many businesses, the change could mean fewer 1099s to prepare. It does not mean it’s time to stop collecting W-9s.
Collecting a W-9 when a vendor relationship begins gives you the legal name, address, taxpayer identification number and tax classification you may need later. It also saves you from chasing down information in January if that vendor eventually crosses the reporting threshold.
FIRE is Going Away
The dollar amount isn’t the only thing changing this year. The IRS is also closing the door on a filing system that has been around for decades.
The Filing Information Returns Electronically System, better known as FIRE, is being retired. Beginning with the 2027 filing season for 2026 information returns, IRIS, the Information Returns Intake System, will become the IRS’s electronic filing system for returns previously filed through FIRE.
IRIS itself isn’t new. The IRS has been rolling it out over the last several years. What’s different now is that the transition is becoming final.
There are a few dates current FIRE users should have on their radar:
- November 1, 2026: Last day to submit test information returns through FIRE’s test system.
- November 9, 2026: Last day to make changes to existing FIRE Transmitter Control Code applications.
- November 19, 2026: FIRE stops accepting information returns.
After that, it’s IRIS.
What Does IRIS Mean for Your Business?
For businesses that rely on their accountant, payroll provider, or another third party to handle 1099 filing, most of this change may happen quietly behind the scenes.
Businesses that handle their own filings, however, shouldn’t wait until January to figure out the new system.
The IRS offers a free IRIS Taxpayer Portal where businesses can manually enter information returns or upload them using a CSV file. Businesses planning to file directly through IRIS also need to apply for an IRIS Transmitter Control Code, or TCC.
That’s something worth handling early. The IRS advises allowing up to 45 days for a TCC application to be processed.
It’s also important to remember that businesses filing 10 or more information returns in total are generally required to file electronically. That total is based on information returns in the aggregate, not simply the number of 1099-NECs being filed.
The January Countdown
New threshold. New filing system. Same January.
Form 1099-NEC is generally due to both the recipient and the IRS by January 31. Since January 31 falls on a Sunday in 2027, the filing date moves to February 1, 2027.
Form 1099-MISC has a slightly different schedule. Recipient copies are generally due around the end of January, while IRS filing dates extend later depending on whether the forms are filed electronically or on paper.
Those are the dates on the calendar, but they aren’t necessarily the dates that matter most.
A smooth 1099 season is usually decided before January ever gets here.
Start With What You Can Control
Take a look at your vendor list before year-end.
Are W-9s on file? Are names and taxpayer identification numbers complete? Do you know which vendors are getting close to the new $2,000 threshold? Are payments being tracked consistently? Do you know how those vendors were paid?
Those small questions become a lot bigger when you’re trying to answer them all in January.
The higher reporting threshold may mean fewer forms this year, and the move to IRIS may change how those forms make their way to the IRS. Neither change replaces the basics.
Clean records, complete W-9s and a little preparation now can keep that January stack of papers from becoming too tall.