Preparing for 2026 Form 1099 Filing Changes
The 2026 tax year will bring several meaningful changes to Form 1099 reporting. For many businesses, these updates may affect vendor tracking, payroll-related reporting, filing workflows, and year-end processes. While the filing season for 2026 returns will not arrive until early 2027, waiting until year-end to prepare could create unnecessary pressure.
Three changes deserve particular attention: a higher reporting threshold for certain payments, new reporting fields related to tips and overtime, and the IRS transition away from the FIRE filing system.
A Higher Reporting Threshold
One of the most visible updates is the increase in the reporting threshold for certain information returns. For tax years beginning after 2025, the minimum reporting amount for certain payments increases from $600 to $2,000, with inflation adjustments beginning in calendar year 2027.
This change may reduce the number of Forms 1099-MISC and 1099-NEC some businesses are required to issue. However, it should not be treated as a blanket rule. Certain types of payments continue to have different thresholds or special reporting requirements, including some royalty, attorney, medical, fishing, and other payment categories. Businesses should review payment types carefully before changing their filing approach.
New Tip and Overtime Reporting Fields
The IRS has also updated Forms 1099-MISC and 1099-NEC to allow reporting of cash tips, Treasury Tipped Occupation Codes, and overtime compensation. These changes are tied to new federal reporting requirements and may require businesses to capture information in more detail than they have in the past.
For companies that work with nonemployees, contractors, service providers, or tipped workers, this may mean reviewing how payments are coded throughout the year. Accurate reporting will depend on clean data, clear vendor records, and systems that can separate payment categories before forms are prepared.
FIRE Is Ending, IRIS Is the Path Forward
Another major operational shift is the IRS transition from FIRE to IRIS. Beginning with tax year 2026, filing season 2027, IRIS will be the only IRS intake system for information returns. The IRS has encouraged filers to complete their IRIS Transmitter Control Code application and begin transitioning before the 2027 filing season.
This is especially important because businesses required to file 10 or more information returns generally must file electronically, and the IRS notes that a Transmitter Control Code application may take up to 45 days to process.
The 2026 Form 1099 changes are more than a form update. They are a reminder to review systems, vendor records, and year-end filing procedures now. Brady Martz professionals can help businesses understand how these changes may affect their reporting process and prepare for a smoother filing season.
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