1099 for Landlords: Who Gets One and When

If you paid a vendor $600 or more for services on your rental, you probably owe them a 1099. Below: 1099-NEC vs 1099-MISC, who's exempt, the W-9 collection workflow you should have started six months ago, and the filing deadlines.

Most landlords know they're supposed to issue 1099s. Many don't. The IRS knows the gap — which is why backup withholding rules and TIN mismatch penalties exist. Getting this wrong creates two problems: you may lose the deduction on audit (if you can't prove payment to an identified vendor), and you may owe backup withholding penalties. Here's the complete picture.

1099-NEC vs 1099-MISC

The 1099 landscape was reorganized in 2020 when the IRS reintroduced Form 1099-NEC (Nonemployee Compensation) as a standalone form. Before that, nonemployee compensation appeared in Box 7 of Form 1099-MISC. The change created two separate forms with different deadlines and different purposes.

Form 1099-NEC covers:

• Payments for services performed in the course of your trade or business by a non-corporate vendor
• The threshold: $600 or more in the calendar year to a single payee
• Includes: contractor payments, property management fees (if paid to an individual or unincorporated entity), repair invoices, landscaping, cleaning, attorney fees for services

Form 1099-MISC covers:

• Rent payments to non-corporate landlords (if you're a business paying rent to someone else — common in commercial, less common in residential PM)
• Royalties ($10+)
• Prize and award payments ($600+)
• Fishing boat proceeds
• Medical and health care payments
• Payments made by the payer to an attorney in settlement (Box 10)
• Direct sales of $5,000+ in consumer products (Box 7)

For most residential landlords and property managers, 1099-NEC is the relevant form. The typical scenario: you paid a plumber, electrician, landscaper, or handyman $600 or more. They get a 1099-NEC.

Who gets one (vendors paid $600+)

The rule is simple: if you paid a vendor $600 or more in a calendar year for services rendered in connection with your rental business, and the vendor is not a C corporation or S corporation (with one exception — see next section), issue them a 1099-NEC.

"Paid" means cash-basis — the date you actually sent money, not the date the service was rendered. A November repair invoice paid in January counts toward January's calendar year.

"Services" means actual work — labor, professional services, management. It doesn't include product purchases (materials, hardware, supplies). A vendor who sells you $800 in lumber doesn't get a 1099. A contractor who charges you $800 for labor (and buys materials as part of the job) probably does — the IRS looks at the total payment when services are the primary purpose.

Vendors who commonly get 1099s from landlords:

• Plumbers, electricians, HVAC technicians (if unincorporated)
• Handymen and general contractors
• Landscapers and lawn care
• Cleaning companies (if unincorporated)
• Property managers you hire (if unincorporated or LLC without S/C election)
• Accountants and bookkeepers
• Pest control, snow removal, painters

Payments NOT subject to 1099 reporting:

• Credit card payments (the processor reports via Form 1099-K)
• Payments to employees (use W-2)
• Reimbursed expenses with receipts
• Purchases of goods or materials only

Credit card payments are excluded because the payment processor handles the reporting. Some operators deliberately route vendor payments through a business card to reduce their 1099 burden — legitimate if the payments actually clear through the card.

Who doesn't (corporations, with exceptions)

The general rule: corporations are exempt from 1099-NEC reporting. If you pay Smith & Jones Plumbing Corp., you don't issue a 1099. The corporation has its own tax compliance obligation.

But there are two important exceptions:

Exception 1: Attorneys. Regardless of business structure (individual, partnership, LLC, corporation, law firm), attorneys always receive a 1099-NEC for legal services of $600 or more. Box 1 of 1099-NEC. This is a statutory requirement — the incorporated attorney exception doesn't apply to legal fees. If you paid your eviction attorney $1,500 this year, they get a 1099-NEC regardless of their firm structure.

Exception 2: Medical and health care providers. If your business pays medical corporations (unlikely for most landlords, but possible in certain commercial or assisted-living contexts), they get 1099-MISC Box 6 regardless of corporate status.

The LLC ambiguity: LLCs are not automatically corporations. Their 1099 treatment depends on how they're taxed:

• LLC taxed as a sole proprietor or partnership: receives a 1099 (not exempt)
• LLC taxed as an S corporation: exempt (same as S corp)
• LLC taxed as a C corporation: exempt (same as C corp)

This is why you need to collect a W-9 from every vendor — the W-9 tells you how the payee is organized and taxed, which tells you whether to issue a 1099.

Summary table:

The W-9 collection workflow

The W-9 gives you the vendor's legal name, tax classification (individual, partnership, S corp, etc.), and TIN (SSN or EIN). You need it before the first payment — not in January when 1099s are due.

If a vendor won't provide a W-9, withhold 24% of every payment as backup withholding and remit it to the IRS. In practice, most vendors comply when asked before payment.

Workflow that holds:

1. No W-9, no payment: Add a W-9 requirement to your new vendor onboarding. Before processing any invoice from a new vendor, confirm you have their W-9 on file.

2. Email before first invoice: "Before we process payment, please return the attached W-9. We're required to have this on file." One sentence. Most vendors respond same day.

3. Digital collection: Many PM platforms and e-file services (Tax1099, TaxBandits) let vendors complete W-9s electronically — faster than PDF email chains.

4. Annual refresh for major vendors: For vendors you pay $5,000+ per year, request an updated W-9 each September or October in case their entity or TIN changed.

If you missed W-9 collection for past vendors, request them retroactively. Document every attempt — the IRS may reduce penalties if you demonstrate good-faith effort.

Filing deadlines (1/31, 2/28, 3/31)

The deadlines differ by form and filing method:

Form 1099-NEC:

• January 31: Send Copy B to the recipient (payee) — the deadline for giving the vendor their copy
• January 31: File Copy A with the IRS (both paper and electronic) — 1099-NEC has a unified January 31 deadline regardless of filing method
• No extension of this deadline without approval: Form 8809 can request a 30-day extension, but automatic extension is not available for 1099-NEC

Form 1099-MISC (if applicable):

• January 31: Send Copy B to the recipient
• February 28: File paper Copy A with the IRS
• March 31: File electronic Copy A with the IRS (if e-filing)

Practical implications:

• If you e-file 1099-MISC (as most do), you have until March 31 — giving you more time to gather information and correct errors
• If you e-file 1099-NEC, the January 31 deadline still applies — no extra time for electronic filing
• E-filing is required if you file 10 or more information returns (10+ 1099s of any type) — the threshold dropped from 250 to 10 starting with 2023 returns

The penalty structure for late or incorrect 1099s:

• Filed correctly within 30 days of deadline: $60 per return (max $630,500/year for small businesses)
• Filed correctly within the Aug 1 deadline: $120 per return
• Filed after August 1 or not filed: $310 per return
• Intentional disregard: $630 per return (minimum)

These penalties are per return. If you have 20 vendors and you miss the deadline by 60 days, that's potentially $2,400 in penalties before any interest.

For context on the year-end reporting workflow that incorporates 1099s, see owner distribution reports: what property managers need to send. For the monthly close process that tracks vendor payments throughout the year, see the property manager's month-end closing checklist.

Common mistakes

Not collecting W-9s before paying. The most common error. Without a TIN, you can't file an accurate 1099. The fix is to contact every vendor in November and request retroactive W-9s — unpleasant, but necessary.

Missing vendors who crossed $600 in aggregate. One payment of $400 and another of $300 = $700 total = 1099 required. Track by vendor-year total, not by invoice. PM software that aggregates by TIN does this automatically.

Issuing to corporations. You don't owe 1099-NECs to C corps or S corps (except attorneys). Issuing them anyway isn't a penalty, but it creates reconciliation confusion.

Reporting only labor, not total payments. A plumber charging $800 labor + $300 materials on one invoice gets a 1099-NEC for $1,100 — the full amount. Report total payments, not just the service portion.

Using the wrong form. Since 2020, services go on 1099-NEC, not 1099-MISC Box 7. Wrong form = IRS mismatch.

Assuming credit card payments need a 1099. Credit card payments are excluded — the processor files Form 1099-K. Check-paid amounts still require 1099-NEC if they reach $600 on their own.

Missing the January 31 deadline. Unlike 1099-MISC, there's no extra time for e-filers on 1099-NEC. Set a calendar reminder for January 20.

Tools that print/e-file these

E-filing is required for 10+ information returns. Two approaches work:

PM software with built-in 1099 workflow: Platforms that track vendor payments all year generate 1099s pre-populated by TIN at year-end. You review, approve, and the software e-files with the IRS and mails recipient copies. Zero manual data entry.

Third-party e-filing services: Tax1099, TaxBandits, and Track1099 each charge $3–$5 per form, accept data via spreadsheet upload or QuickBooks import, and handle both IRS filing and recipient mailing. The IRS FIRE system is free but requires technical setup.

For small portfolios (under 10 vendors), a third-party service is fine. For 25+ vendors, PM software with native 1099 workflow eliminates the data-assembly step entirely.

FAQ

Do I issue a 1099 to my property management company? Depends on their structure. C corps and S corps are exempt. Sole proprietors, partnerships, and LLCs taxed as pass-throughs are not. Their W-9 will tell you. Most professional PM firms are incorporated — no 1099 required.

What if a vendor's TIN doesn't match IRS records? The IRS sends a B-Notice (CP2100). Begin backup withholding at 24% on that vendor immediately, and request a corrected W-9. Withholding stops once the vendor provides a valid TIN.

Do I need to issue 1099s for properties held in an LLC? Yes, if the LLC pays vendors $600+. Single-member LLCs (disregarded entities) are treated as sole proprietors. Multi-member LLCs taxed as partnerships also issue 1099s.

Can I file a corrected 1099 after the deadline? Yes. Check the "CORRECTED" box and resubmit as soon as you catch the error. Corrections within 30 days of the deadline receive reduced penalties.

Does Airbnb or VRBO send me a 1099 for rental income? If you hit the platform's 1099-K threshold, yes — they file with the IRS and send you a copy. The exact dollar threshold has been subject to IRS transition guidance; confirm with your CPA. Either way, rental income is reportable whether or not you receive a 1099-K.

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This isn't tax advice. Talk to a CPA who works with rental real estate before acting on anything here.