Tax

Does an LLC or S-corp get a 1099? The complete guide

July 18, 2026

Most LLCs do receive Form 1099-NEC for services over $600, but LLCs taxed as S-corps or C-corps are exempt because their income is already reported through other IRS forms. The answer depends on how the LLC is taxed, not just that it's an LLC.

Do LLCs get a 1099? The short answer

Most LLCs do receive Form 1099-NEC for services over $600, but LLCs taxed as S-corps or C-corps are exempt because their income is already reported through other IRS forms.

Here's the breakdown by tax treatment:

Single-member LLCs (disregarded entities): YES, receive 1099-NEC for $600+ in services
Multi-member LLCs taxed as partnerships: YES, receive 1099-NEC
LLCs taxed as S-corporations: NO, exempt from 1099-NEC
LLCs taxed as C-corporations: NO, exempt (except attorney payments)

The confusion happens because "LLC" is a legal structure, not a tax classification. An LLC can be taxed as a sole proprietorship, partnership, S-corp, or C-corp—and that tax election determines 1099 treatment.

LLC Type	Tax Treatment	Receives 1099?	Owner Reports On	Example TIN on W-9
Single-member (default)	Disregarded entity	Yes	Schedule C (Form 1040)	Owner's SSN
Single-member (elected)	S-corporation	No	W-2 + Schedule K-1	LLC's EIN, "S corporation" checked
Multi-member (default)	Partnership	Yes	Schedule K-1 (Form 1065)	LLC's EIN, "Partnership" checked
Multi-member (elected)	S-corporation	No	W-2 + Schedule K-1	LLC's EIN, "S corporation" checked
Any LLC (elected)	C-corporation	No*	Form 1120	LLC's EIN, "C corporation" checked

*Exception: Payments to attorneys must be reported on 1099-NEC box 1 even if the LLC is a C-corp.

1099 rules by LLC type and tax election

Single-member and partnership LLCs receive 1099s. S-corp and C-corp LLCs don't, because the IRS already sees their income through W-2s, K-1s, and corporate returns.

Single-member LLC (disregarded entity): The IRS ignores the LLC for tax purposes. The 1099 goes to the LLC name but uses the owner's Social Security Number. The owner reports this income on Schedule C (Form 1040), line 1, like any sole proprietor.

Multi-member LLC (partnership): The LLC entity receives the 1099-NEC. It then files Form 1065 and issues each member a Schedule K-1 showing their share. Members report their K-1 income on Form 1040, Schedule E. The 1099 goes to the LLC; income then flows to members.

LLC taxed as S-corp: Exempt because owner income is already reported through W-2 wages (for reasonable compensation) and Schedule K-1 distributions (for remaining profit). The 1099-NEC is for nonemployee compensation. S-corp owners are employees by definition, so the form doesn't apply.

LLC taxed as C-corp: Exempt under the general corporation exemption. C-corps file Form 1120 and pay corporate tax, so the IRS already sees their income. The only exception: payments to attorneys must be reported on 1099-NEC box 1 regardless of corporate status.

Why S-corp LLCs don't get 1099s (and where the money goes instead)

S-corp LLCs are exempt because owner income is already reported through W-2 wages and Schedule K-1 distributions.

When you pay an S-corp LLC for services, the money doesn't go to the owner as "nonemployee compensation." Instead, the S-corp pays the owner a reasonable salary (reported on W-2), and any remaining profit is distributed as a Schedule K-1 distribution.

Real example: You pay Smith Consulting LLC (taxed as S-corp) $120,000 for services in 2025.

Smith Consulting receives $120,000 in revenue (no 1099 from you)
The S-corp pays the owner $60,000 in W-2 wages
The remaining $60,000 is distributed as a K-1 distribution
Total owner income: $60,000 W-2 + $60,000 K-1 = $120,000 (all accounted for without a 1099)

Compare this to the same LLC operating as a disregarded entity:

You issue a 1099-NEC to Smith Consulting LLC for $120,000
The owner reports $120,000 on Schedule C (Form 1040)
The owner pays self-employment tax on the full $120,000

The S-corp structure splits income into wages (subject to payroll tax) and distributions (not subject to self-employment tax). Because the IRS already sees both pieces through W-2s and K-1s, a 1099 would be duplicate reporting.

The single-member LLC W-9 confusion (EIN vs SSN)

Single-member LLCs that haven't elected corporate taxation use the owner's SSN on Form W-9 and must receive a 1099, even though the check goes to the LLC name.

You write the check to "Smith Consulting LLC," but the W-9 shows the owner's Social Security Number with no tax classification box checked. This means the LLC is disregarded—the owner reports income as a sole proprietor.

The IRS rule: If the W-9 shows an SSN, issue the 1099 regardless of "LLC" in the business name.

Common mistake: A contractor provides the LLC name with an SSN, and the payer assumes it's a corporation and doesn't issue a 1099. This creates a mismatch when the IRS compares the contractor's tax return (showing the income) to the payer's records (showing no 1099 filed).

Example W-9 scenario:

Business name: Smith Consulting LLC
Tax ID: 123-45-6789 (SSN format)
Tax classification: No box checked
Result: Disregarded entity, requires 1099-NEC for $600+ in services

If the same LLC had elected S-corp taxation:

Business name: Smith Consulting LLC
Tax ID: 12-3456789 (EIN format)
Tax classification: "S corporation" box checked
Result: Exempt from 1099-NEC

Multi-member LLCs and partnerships: when the entity gets the 1099

Multi-member LLCs taxed as partnerships receive 1099s for services, then report the income on Form 1065 and distribute it to members via Schedule K-1.

When a multi-member LLC provides services, the LLC entity itself receives the 1099-NEC. The 1099 doesn't pass through to individual members. Instead, the LLC aggregates all income (including 1099 amounts) on Form 1065, then allocates shares to each member via Schedule K-1.

Example: A 2-member LLC receives $80,000 for consulting services in 2025.

The payer issues a 1099-NEC to the LLC for $80,000
The LLC files Form 1065 showing $80,000 in ordinary business income (line 1)
Each member receives a Schedule K-1 showing their $40,000 share (assuming 50/50 ownership)
Each member reports their $40,000 on Form 1040, Schedule E (line 28)

This treatment applies to LLPs (limited liability partnerships) as well.

Key point: The 1099 goes to the entity, not the individual members. If you pay two members directly for their individual services, you'd issue separate 1099s to each person. But if you pay the LLC for services performed by the partnership, one 1099 goes to the LLC.

What to do when your LLC receives a 1099

Single-member LLCs report 1099 income on Schedule C. Multi-member LLCs report it on Form 1065 and distribute to members via K-1.

Single-member LLC (disregarded entity):

Report the 1099-NEC amount on Schedule C (Form 1040), line 1
This income is subject to self-employment tax (Schedule SE)
The 1099 should match your records; if it doesn't, contact the payer immediately to request a corrected form

Multi-member LLC (partnership):

Report the 1099-NEC amount on Form 1065, line 1
The partnership allocates income to members via Schedule K-1
Each member reports their K-1 share on Form 1040, Schedule E

Verification steps:

Compare the 1099 amount to your invoice records for that payer
Check that your business name and TIN match your tax return exactly
If incorrect, contact the payer before they file with the IRS (deadline is January 31 for paper filing, March 31 for e-filing)
Keep the 1099 with your tax records—the IRS matches 1099s to your return via your TIN

Important: If you didn't receive a 1099 but earned $600 or more from a client, you still must report the income. The 1099 is for IRS matching purposes, not income recognition.

The $600 threshold and payment types that require a 1099

You must issue a 1099-NEC to an LLC if you paid $600 or more during the calendar year for services, not merchandise or rent.

The $600 threshold is cumulative per payee per calendar year. If you pay an LLC $400 per month for 18 months, that's $7,200 total—you must issue a 1099-NEC. If you pay $500 once, no 1099 is required.

1099-NEC is required for:

Services (consulting, freelance work, contract labor)
Professional fees (legal, accounting, design)
Commissions and fees
Prizes and awards (if not for services, use 1099-MISC box 3)

1099-NEC is NOT required for:

Merchandise or inventory purchases
Payments to employees (use Form W-2)
Rent paid to real estate agents (use 1099-MISC box 1)
Payments to corporations (except attorneys and specific medical/healthcare payments)

Form 1099-K (separate requirement): Payment settlement entities like PayPal, Venmo, and Square must issue Form 1099-K if they process more than $5,000 in payments for you in 2025. This threshold applies regardless of entity type—even S-corp LLCs receive 1099-K forms. The 1099-K reports gross payment volume, not net income.

Example: You pay an LLC $400/month for bookkeeping for 18 months = $7,200 total. You must issue a 1099-NEC. If you paid the same LLC $500 once for a laptop (merchandise), no 1099 is required.

Do S-corps get a 1099?

No, S-corporations (including LLCs taxed as S-corps) do not receive Form 1099-NEC because their income is already reported through W-2 wages and Schedule K-1 distributions.

The S-corp exemption applies whether the business is a traditional S-corporation or an LLC that has elected S-corp taxation. When you pay an S-corp for services, that payment doesn't constitute "nonemployee compensation" because S-corp owners are employees by definition. The IRS already tracks their income through W-2 forms (for reasonable salary) and Schedule K-1 forms (for profit distributions).

Form W-9 from an S-corp will show "S corporation" checked in the tax classification box—signaling that no 1099-NEC is required. The only exception is payments to attorneys, which must be reported on 1099-NEC regardless of corporate status.

Edge cases: mid-year S-corp election and missing W-9s

If an LLC elects S-corp status mid-year, request an updated W-9 to determine the effective date and consult a tax professional about split reporting. If they won't provide a W-9, you must backup withhold 24%.

Mid-year S-corp election: When a vendor changes tax classification during the year, request an updated W-9 immediately. The W-9 should indicate the new tax classification and effective date. Because tax elections can have varying effective dates, consult with a tax professional to determine correct reporting for payments made before and after the election.

Example scenario:

You paid ABC Consulting $10,000 total in 2025
The vendor notifies you in July that they elected S-corp status effective July 1
You request an updated W-9 showing the S-corp classification
Consult your tax advisor: issue 1099-NEC for $6,000 (payments before July 1), no 1099 for $4,000 (payments after)

Missing W-9 scenario: If an LLC refuses to provide a W-9 or provides an incorrect TIN, you must backup withhold 24% of all payments and remit the withheld amount to the IRS using Form 945.

Backup withholding example:

You owe a vendor $5,000 for services
The vendor won't provide a W-9
You withhold $1,200 (24% of $5,000)
You pay the vendor $3,800
You remit $1,200 to the IRS quarterly using Form 945

Backup withholding applies even if the LLC would otherwise be exempt from 1099s (for example, an S-corp that refuses to provide a W-9 still triggers backup withholding).

Penalties for incorrect filing:

$60 per form if you file within 30 days of the deadline (maximum $630,500 per year)
$120 per form if you file 31+ days late but before August 1 (maximum $1,891,500 per year)
$310 per form if you file after August 1 or don't file at all (maximum $3,783,000 per year)
$630 per form for intentional disregard (no annual cap)

The IRS can waive penalties if you show reasonable cause for the failure.

State-level 1099 requirements and variations

Most states follow federal 1099 rules. California and Massachusetts have additional state-specific requirements.

The majority of states don't have separate 1099 filing requirements—they rely on federal reporting. Some states require additional forms:

California: Requires separate state reporting for payments to California residents or entities over $600. Use Form 592-B for nonresident withholding if you paid a non-California entity for services performed in California. California follows the same federal exemptions (S-corps and C-corps are exempt from state 1099 requirements).

Massachusetts: Requires Form 1099-HC (Health Coverage) to report health insurance coverage for Massachusetts residents. This is in addition to federal 1099-NEC requirements, not a replacement.

Important: No state changes the federal exemption for S-corps or C-corps. If an LLC is exempt from federal 1099-NEC because it's taxed as an S-corp, it's also exempt from state 1099 reporting.

Check your state's department of revenue website for specific requirements.

How Uplinq handles 1099 tracking automatically

Uplinq automatically tracks vendor payments, collects W-9s, and generates 1099-NEC forms with IRS e-filing, eliminating manual year-end scrambles.

Automatic transaction flagging: When you connect your bank account, Uplinq imports all transactions and flags vendor payments over $600. The system categorizes payments by 1099 eligibility—services vs. merchandise, employee vs. contractor—so you don't manually track cumulative totals.

W-9 collection prompts: When a vendor crosses the $600 threshold, Uplinq prompts you to collect their W-9. The system stores the form securely and extracts the tax classification (disregarded entity, partnership, S-corp, C-corp) to determine 1099 requirements automatically.

Mid-year election tracking: If a vendor changes their tax status mid-year, Uplinq tracks the election date and pro-rates the 1099 requirement. You don't manually calculate which payments fall before or after the election.

Year-end 1099 generation: In January, Uplinq generates 1099-NEC forms for all eligible vendors with IRS e-file integration. The system pre-fills recipient information from stored W-9s, calculates totals from your transaction history, and submits directly to the IRS.

Deadline management: Uplinq sends reminders before the January 31 filing deadline and tracks submission status so you never miss a filing or face late penalties.

Connect your bank and Uplinq will flag every vendor payment, collect W-9s, and file your 1099-NECs on time.

FAQ: LLC and S-corp 1099 questions

Does an LLC partnership get a 1099? Yes, multi-member LLCs taxed as partnerships receive Form 1099-NEC for services over $600. The LLC reports this income on Form 1065 and distributes shares to members via Schedule K-1.

Does an S-corp LLC get a 1099? No, LLCs taxed as S-corporations are exempt from 1099-NEC because their income is already reported through W-2 wages and Schedule K-1 distributions.

Do you send a 1099 to an LLC? It depends on the LLC's tax classification. Send a 1099-NEC to single-member LLCs (disregarded entities) and multi-member LLCs taxed as partnerships. Do not send to LLCs taxed as S-corps or C-corps.

Should an LLC receive a 1099? Single-member LLCs and partnership LLCs should receive 1099-NEC forms for services over $600. LLCs taxed as S-corps or C-corps should not receive them (except C-corp attorneys).

Does an LLC corporation get a 1099? No, if an LLC has elected corporate taxation (S-corp or C-corp), it is exempt from receiving 1099-NEC forms, with the exception of C-corp attorneys who must receive them.

Do LLCs receive 1099 forms? Most LLCs receive 1099-NEC forms for services over $600, but the requirement depends on tax classification. Check the LLC's Form W-9 to see if they've elected S-corp or C-corp status, which exempts them from 1099 requirements.

This article is for general informational purposes only and does not constitute tax, legal, or accounting advice. Tax rules and fees change frequently and vary by state and situation. Consult a qualified professional before making decisions about your business.