The short version
- If your rental activity is a trade or business, you may need to send 1099s to unincorporated vendors you paid above the federal threshold for services during the year.
- Property managers usually report rent they collected and paid out to owners.
- Collect a W-9 from every vendor before you pay them, not in January.
- Payments made by card or through a payment processor are generally reported by the processor, not by you.
- Thresholds and rules change. Confirm the current rules with your CPA each year.
Every January, landlords and property managers dig through a year of payments to figure out who needs a 1099. Vendors who never sent a W-9 have to be chased, addresses are missing, and deadlines are close. Most of that stress is avoidable with a simple routine during the year.
This guide covers the general rules in plain language. Tax reporting rules are detailed and they change, so treat this as a starting point and confirm the specifics with your CPA.
What a 1099 is
A 1099 is an information return. It tells the IRS, and the person you paid, how much you paid them during the year. The recipient uses it to report their income. For landlords, the two forms that come up most are:
- Form 1099-NEC for nonemployee compensation, such as payments to contractors for services.
- Form 1099-MISC for rents and certain other payments, which is the form property managers often use to report rent paid to owners.
Do you need to file?
The first question is whether your rental activity is a trade or business. The IRS requires 1099 reporting for payments made in the course of a trade or business. For a property manager or a landlord with a larger portfolio, the answer is usually yes. For an owner with a single rental, it depends on the facts, such as how actively you manage it.
Many CPAs advise small landlords to file 1099s anyway when they are unsure, because filing is easy and not filing when required can bring penalties. This is a question to settle with your CPA once and then apply every year.
Which vendors usually get one
If you are required to file, the general rule is that you send a 1099-NEC to a vendor when all of these are true:
- You paid them for services, including parts and materials supplied as part of the service.
- They are not an employee.
- They are not a corporation, with exceptions such as attorneys.
- Your total payments to them during the year meet the federal threshold.
- You paid them by check, cash or bank transfer, not by credit card or through a payment processor that reports the payment itself.
Some examples:
| Vendor | Usually gets a 1099? | Why |
|---|---|---|
| Independent plumber (sole proprietor) paid by check | Yes, if over the threshold | Unincorporated service provider |
| Handyman paid in cash | Yes, if over the threshold | Cash payments count |
| HVAC company that is an S or C corporation | Usually no | Corporations are generally exempt |
| Attorney for an eviction case | Usually yes | Legal fees are reportable even to many corporations |
| Landscaper paid by credit card | Usually no | The card processor reports it |
| Hardware store for supplies | No | Purchase of goods, not services |
| Utility company | No | Usually a corporation, and not a service vendor in this sense |
The threshold
For many years, the threshold for nonemployee compensation and rents was $600 for the year. A federal tax law passed in 2025 raised the threshold to $2,000 for payments made starting in 2026, with inflation adjustments in later years. Payments made in 2025 still used the $600 threshold.
Because thresholds and forms change, check the current numbers on the IRS website or with your CPA before you file each year.
Property managers: rent paid to owners
If you are a property manager who collects rent on behalf of owners, you are generally required to report the gross rent you collected and paid to each owner on a 1099-MISC, if the amount meets the threshold. You may also issue 1099s to vendors you paid on the owner’s behalf from the owner’s funds. How these are reported, and which party files, should be clear in your management agreement. Our property management agreement template includes a section on reporting and records.
Owners who are corporations usually do not receive a 1099. Get a W-9 from every owner at onboarding so you know how each one is classified.
Collect W-9s up front
The single best habit is to get a completed W-9 from every vendor and owner before you pay them. The W-9 gives you their legal name, tax classification, address and taxpayer identification number.
Make it part of vendor onboarding:
- Ask for the W-9 with the first quote or invoice.
- Store it with the vendor record, not in an email thread.
- Do not release the first payment until you have it, unless you have a clear process for backup withholding.
- Review W-9s every few years, or when a vendor changes their business structure.
If a vendor refuses to provide a taxpayer identification number, the IRS backup withholding rules may require you to withhold a portion of payments. Ask your CPA how to handle this.
A year-round routine
Here is a routine that turns January into a review rather than a project:
| When | Task |
|---|---|
| Every new vendor | Collect a W-9 and mark the vendor as 1099 eligible or not |
| Every bill | Record which vendor and which payment method, so card payments can be excluded |
| Quarterly | Run a vendor totals report and look for vendors without a W-9 |
| Early December | Confirm addresses and tax IDs for vendors near or over the threshold |
| Early January | Run the final totals, review with your CPA, and file |
How software helps
The data for 1099s already lives in your books: who you paid, how much and how. The job is to pull it together accurately. In TenantLoop bookkeeping, 1099 reports show totals per vendor for the year, ready for you to file. If you file through Track1099, you can export the data for it; see integrations for what is available. If your accountant prefers to work in QuickBooks Online, vendor and bill data sync there on the schedule you set.
Common mistakes
- Waiting until January to collect W-9s. Vendors are hardest to reach once the work is done.
- Including card payments. Payments by card are generally reported by the processor. Reporting them again creates a mismatch.
- Reporting goods. Supply purchases are not reportable as nonemployee compensation.
- Missing cash payments. Cash to a handyman counts toward the threshold.
- Using last year’s threshold. Check the current figure each year.
1099 checklist
- Confirm with your CPA whether you are required to file
- Collect a W-9 from every vendor and owner before the first payment
- Mark each vendor as 1099 eligible based on the W-9
- Record payment method on every bill
- Run vendor totals quarterly and before year end
- Confirm the current threshold and deadlines
- File and send forms by the deadline
Note: This is general information, not tax advice. 1099 rules, thresholds and deadlines change, and whether they apply to you depends on your situation. Confirm everything with a qualified CPA or tax professional.
The bits people get stuck on.
Do landlords have to send 1099s to contractors?
Landlords whose rental activity counts as a trade or business generally must file a 1099 for payments to unincorporated service providers above the federal threshold. Whether a small rental counts as a trade or business depends on the facts. Many CPAs recommend filing anyway when in doubt. Ask yours.
What is the 1099 reporting threshold?
For many years the threshold for nonemployee compensation and rents was $600. A federal tax law passed in 2025 raised it to $2,000 for payments made starting in 2026, with inflation adjustments in later years. Check the current threshold with your CPA or on the IRS website before filing.
Do I need to send a 1099 to a corporation?
Generally not, with some exceptions. Payments to attorneys for legal services are usually reportable even if the law firm is a corporation. The W-9 tells you how the vendor is classified.
When are 1099s due?
Form 1099-NEC is generally due to both the recipient and the IRS by January 31. Other 1099 forms have their own deadlines. If a deadline falls on a weekend or holiday, it moves to the next business day.