1099 Contractor Tracking

If your nonprofit pays contractors, consultants, or freelancers above the IRS reporting threshold in a calendar year, you are required to file IRS Form 1099-NEC for each of those vendors. NP Ledger tracks 1099 eligibility year-round so you are never surprised in January.

Reporting threshold by year. The threshold is $600 for tax year 2025 and earlier. Under the 2025 federal tax law (OBBBA), it rises to $2,000 for payments made in 2026 and later (reported in 2027), and is inflation-indexed after that. NP Ledger applies the correct threshold automatically based on the tax year you select in the 1099 Summary report.

1. Mark Vendors as 1099-Eligible

From the Vendors list, toggle the 1099 badge on any vendor you pay as a contractor. You can also set 1099 details (vendor type, last 4 of TIN, W-9 status, and mailing address) when creating or editing a vendor.

2. Review the 1099 Summary Report

Go to Reports > 1099 Summary to see all tracked vendors with their calendar-year payment totals. The report shows:

• Above the threshold -- vendors who require a 1099 filing (red badge). The dollar figure shown reflects the selected tax year ($600 through 2025; $2,000 from 2026).
• Approaching -- vendors nearing the threshold (amber badge), starting at two-thirds of the filing threshold
• Below -- tracked but not yet at the threshold

The report uses calendar-year dates (January 1 through December 31), regardless of your organization's fiscal year setting.

3. Export for Tax1099.com

When you are ready to file, click Export for Tax1099.com on the 1099 Summary page. This opens a pre-flight page where you can:

• Review any missing vendor or organization information
• Enter full Taxpayer Identification Numbers (SSN or EIN) for each vendor

Click Download CSV to generate a file compatible with Tax1099.com and Track1099 bulk upload. The full TINs you enter are used only to generate the download -- they are never saved to the database.

4. Dashboard Widget

If you have any 1099-eligible vendors, the dashboard shows a 1099 Tracker card with the current count of vendors above and approaching the filing threshold.

• Calendar year only. 1099 reporting always uses January 1 through December 31, even if your fiscal year is different.
• Payment transactions only. Only posted, non-void payment transactions count toward 1099 totals. Payroll transactions are excluded (employees receive W-2s, not 1099s).
• Split payments. If a single transaction has line items allocated to different vendors, each vendor's share is counted separately.
• Misclassification warning. If a 1099-eligible vendor also appears in payroll transactions, the report displays a warning so you can verify the classification.
• TIN security. NP Ledger stores only the last 4 digits of each vendor's TIN for verification. Full TINs are entered at export time and never persisted.

• Mark vendors as 1099-eligible as soon as you start paying them, not just at year-end.
• Collect W-9 forms before making the first payment and check the W-9 box in NP Ledger.
• Review the 1099 Summary quarterly to catch vendors approaching the threshold.
• Use the dashboard widget for at-a-glance monitoring throughout the year.