What we file
- Form 1099-NEC for non-employee compensation of $2,000 or more for payments made in 2026 (the threshold was $600 through 2025)
- Form 1099-MISC for rents, prizes and other reportable payments
- W-9 collection and TIN matching before payments go out, not after
- Recipient copies and IRS transmittal, with electronic filing
- Oregon reporting where required
Classification, honestly
Both the IRS and Oregon apply multi-factor tests to whether a worker is an employee or an independent contractor, and the factors look at behavioral control, financial control and the nature of the relationship. Oregon applies its own standard for unemployment insurance purposes, which can produce a different answer than the federal test. Misclassification exposes a business to back payroll taxes, penalties and interest — and the assessment usually arrives years later, covering every worker in the same category.
- Do you control how the work is done, or only the result?
- Does the worker have a genuine opportunity for profit or loss?
- Do they provide their own tools, work for other clients, and carry their own insurance?
- Is the relationship open-ended, and is the work central to your business?
Do I file a 1099 for a business I paid?
Generally not for payments to a corporation, with exceptions such as legal fees. The W-9 tells you the entity type, which is why collecting it up front matters.
I paid someone through a payment app. Do I still issue a 1099?
Payments made through a third-party settlement network are generally reported by that network on Form 1099-K rather than by you on a 1099-NEC. Getting this wrong causes double-reporting.
What if I have already misclassified someone?
Come and talk about it before an agency raises it. Voluntary correction programs exist and the position is far better than waiting for an audit.
Does Oregon have its own rules?
Yes — Oregon applies its own test for unemployment insurance, and a worker can be a contractor federally and an employee for Oregon UI purposes.
Talk it through before filing season starts
Start with a complimentary 15-minute introductory call about your situation and whether we are a good fit. No tax advice is given on that call.
Written by
Bookkeeper, 25+ years
Katie has kept books for small businesses for more than 25 years — QuickBooks, payroll, AP, AR, reconciliations and monthly reporting.
Reviewed by
Heather Perkins
Enrolled Agent, Oregon Licensed Tax Consultant
Last reviewed
This page is general information about Oregon, Washington and federal tax rules, not advice about your own return. Thresholds and rates change every year. Figures were verified as of August 2026 — check the linked official sources, or talk to us about your situation.