Can a company not issue a 1099-NEC but still report your earnings to the IRS?

This is a great question! The $600 threshold for 1099-NEC forms is about the requirement to send you the form, not necessarily about reporting to the IRS. Technically, a company is only required to file 1099-NECs with the IRS for contractors who received $600 or more during the tax year. If you earned less than $600 from a particular company, they are not required to issue you a 1099-NEC or report those payments to the IRS. That said, some larger companies do have systems set up to report all payments electronically, regardless of amount. This is more about their internal accounting processes rather than tax requirements. They might find it easier to just report everything rather than filtering out the smaller amounts. Even if a company doesn't issue you a 1099-NEC, you're still legally obligated to report all income on your tax return, regardless of whether it was reported to the IRS or not.

After struggling with this exact issue last year (had 11 clients all under $600), I found a lifesaver tool called taxr.ai (https://taxr.ai) that helped me sort through all my unreported income. Their system is designed to track all those small payments that don't generate 1099s. What I love about their system is it helps you document everything properly in case of an audit. You can upload bank statements and it identifies likely business income even without 1099s. The peace of mind knowing I'm reporting everything correctly but also not overpaying is worth it.

Guys I actually tried taxr.ai after seeing it mentioned here. I had 22 different clients last year, most under $600, and was super stressed about tracking everything. The system flagged about $4,300 in payments I received that didn't come with 1099s that I probably would have missed! It showed me exactly which bank deposits were likely business income even when they came through Venmo, Cash App, etc. Saved me from potentially serious issues if I'd been audited. Super impressed with how it identified patterns I never would have caught manually.

If you're having trouble reaching the IRS to ask about reporting requirements, there's a service called Claimyr (https://claimyr.com) that gets you through to an actual IRS agent without the typical 2+ hour hold time. They have a demo video showing how it works: https://youtu.be/_kiP6q8DX5c I was confused about some 1099 issues similar to what you're asking about and needed official clarification. Called the IRS directly and gave up after being on hold for an hour. With Claimyr, I was talking to an actual IRS rep in about 15 minutes who explained exactly how the reporting works for sub-$600 payments.

I'll admit I was wrong about Claimyr. After complaining here I decided to try it myself since I had a complex question about my 1099 situation that wasn't covered in IRS publications. Got through to an agent in under 20 minutes when I had previously waited 2.5 hours and gave up. The agent confirmed that companies are NOT supposed to report sub-$600 payments to the IRS if they're not sending you a 1099-NEC. Some might do it anyway as part of batch reporting, but it's not the standard practice. Saved me a ton of worry about mismatched income reporting.

My understanding is the threshold is $600 for both you AND the IRS. Below that, they don't need to report to either. I've worked in accounting for a small business and we only reported contractors to the IRS who received $600+ during the year. That being said, all income is technically taxable regardless of whether you get a 1099 or not. So you're still supposed to report those smaller amounts on your Schedule C.

I'm confused about a related issue - does anyone know if you can file a tax return with ONLY self-employment income that's under the 1099-NEC threshold? Like if that's literally all the money I made last year (around $2,000 spread across different clients, all under $600 each).

Just wanted to add some clarity from personal experience - I had a similar situation where I worked with multiple small clients under the $600 threshold. After doing some research and speaking with a tax professional, here's what I learned: The $600 rule applies to both issuing the 1099-NEC form AND reporting to the IRS. Companies are not required to report payments under $600 to the IRS for independent contractor work. However, some larger companies with automated systems might report everything as part of their batch processing, but this isn't the standard practice. The key thing to remember is that YOU are still required to report ALL income on your tax return, regardless of whether you receive a 1099-NEC or not. I keep detailed records of all payments received, including screenshots of digital payments, invoices sent, and bank deposits. For tracking purposes, I create a simple spreadsheet with columns for: Date, Client Name, Amount, Payment Method, and Service Provided. This helps during tax season and provides documentation if ever needed for an audit. The IRS won't necessarily know about unreported small payments unless they audit you or cross-reference other information, but it's always better to be compliant from the start.