USTaxPenaltySaver1099 Penalty Calculator 2025
Calculate penalties for late or incorrect 1099 forms. $60-$330 per form based on how late you correct.
E-filing required for 10+ returns. Small business caps available for businesses ≤$5M.
2025 Penalty Rates by Correction Timeline
Small business = average annual gross receipts ≤ $5 million for 3 preceding years
1099 Form Types & Due Dates
| Form | Description | Due Date (Recipient / IRS) |
|---|---|---|
| 1099-NEC | Non-employee compensation | January 31 |
| 1099-MISC | Rent, royalties, prizes, other income | January 31 / February 28 |
| 1099-INT | Interest income | January 31 / February 28 |
| 1099-DIV | Dividends and distributions | January 31 / February 28 |
| 1099-B | Broker and barter exchange transactions | February 15 / February 28 |
| 1099-R | Retirement plan distributions | January 31 / February 28 |
| 1099-K | Payment card and third-party transactions | January 31 / February 28 |
| 1099-S | Real estate transactions | February 15 / February 28 |
E-filing extends IRS deadline to March 31. Recipients always receive by January 31.
E-Filing Required: 10+ Returns = Mandatory
If you file 10 or more information returns combined (1099s + W-2s + all other types), you MUST e-file. Paper filing when e-file is required means the IRS treats your returns as NOT FILED—triggering automatic Tier 3 penalties.
Warning: Penalties Can Apply Twice
IRC § 6721 (filing with IRS) and § 6722 (furnishing to recipients) penalties are assessed separately. If you fail both obligations, your penalty doubles.
Example: 100 late 1099-NECs at Tier 3 = $33,000 (§ 6721). If you also didn't send copies to contractors = another $33,000 (§ 6722). Total: $66,000.
Common 1099 Penalty Scenarios
Scenario 1: Small Business, 15 Late 1099s
- • 15 × $330 (Tier 3) = $4,950
- • Small business cap: $1,329,000
- • Actual penalty: $4,950
Scenario 2: Corrected Within 30 Days
- • 50 1099s filed late, corrected in 25 days
- • 50 × $60 (Tier 1) = $3,000
- • Saved $13,500 vs waiting
Scenario 3: Paper Filed (E-file Required)
- • 25 forms paper filed instead of e-file
- • Treated as NOT FILED = Tier 3
- • 25 × $330 = $8,250
Scenario 4: Intentional Disregard
- • Knowingly used wrong TIN on 10 forms
- • 10 × $660 minimum = $6,600
- • No cap applies
1099 Penalty FAQs
Common questions about 1099 filing penalties
For 2025, 1099 late filing penalties range from $60 to $330 per form depending on how late you file: $60/form if corrected within 30 days; $130/form if corrected after 30 days but by August 1; $330/form if corrected after August 1 or never filed. Intentional disregard carries a minimum $660 penalty per form with no cap.
1099-NEC (non-employee compensation) is due January 31 to both the IRS and recipients. Most other 1099s (MISC, INT, DIV, B, etc.) are due to recipients by January 31, and to the IRS by February 28 (paper) or March 31 (e-file). The 5498 series is due May 31.
Yes, if you file 10 or more information returns of ANY type combined (1099s, W-2s, etc.), you MUST e-file. This threshold was reduced from 250 to 10 starting in 2024. Filing paper when e-file is required results in automatic Tier 3 penalties ($330/form) because the IRS treats them as NOT FILED.
Penalties apply to all 1099 variants: 1099-NEC (contractor pay), 1099-MISC (rent, royalties, prizes), 1099-INT (interest), 1099-DIV (dividends), 1099-B (broker transactions), 1099-R (retirement distributions), 1099-K (payment cards), 1099-S (real estate), and all other information returns.
IRC § 6721 penalizes failure to file correct 1099s with the IRS (Copy A). IRC § 6722 penalizes failure to furnish correct 1099s to recipients (Copy B). Both can apply to the same form—if you fail both, your penalty doubles. For example, 100 late 1099s at $330 each = $33,000, but if you also failed to give copies to recipients, that's $66,000 total.
Yes. Businesses with average annual gross receipts ≤$5 million for the 3 preceding tax years qualify for reduced caps: Tier 1 cap: $232,500 (vs. $664,500); Tier 2 cap: $664,500 (vs. $1,993,500); Tier 3 cap: $1,329,000 (vs. $3,987,000). There is NO cap for intentional disregard penalties.
Incorrect 1099s are treated the same as late filings for penalty purposes. The key is when you correct the error. Common errors include wrong TIN/SSN, incorrect amounts, wrong recipient name, or missing required information. File corrected 1099s as soon as you discover errors to minimize penalties.
Yes, reasonable cause relief is available if you can show you exercised ordinary business care and prudence but couldn't file correctly due to circumstances beyond your control. Common defenses: incorrect TIN from recipient, system failures, natural disasters. The de minimis exception may apply for small dollar errors ($100 or less).
Calculate Your 1099 Penalty
Get a detailed estimate with 2025 rates and small business caps
This calculator provides estimates for informational purposes only. 1099 filing requirements and penalties can be complex. Consult a qualified tax professional for advice regarding your specific situation. We do not provide legal, tax, or financial advice and do not represent you before the IRS.