How Much Is the 1099 Late Filing Penalty? Your Guide to Saving Money

Missing the January 31 deadline for 1099-NEC forms triggers the 1099 late filing penalty, but filing immediately keeps you in the lowest tier. The real win is automating your compliance to avoid penalties entirely.

A $60 mistake sounds small until it happens 10 times. The 1099 late filing penalty starts at $60 per form and climbs to $310 for a late filing in 2024. In 2025, it is $340.

But here's what the IRS won't tell you. These fees are completely avoidable. Lettuce eliminates the guesswork by automatically preparing and filing your 1099s, so you never pay a penalty again.

Is Lettuce right for you?

See if Lettuce can help you keep more of what you earn with our short quiz.

Take Quiz

Know the IRS Penalty Tiers and Deadlines (So You Pay Less)

The IRS penalty system is predictable once you know the exact dollar amounts. The penalty for filing a 1099 late follows a tiered system. And once you know how it works, you're in control. Here's what matters: the specific deadlines that trigger penalties, the dollar amounts at each tier, and the simple steps that keep you compliant without the stress.

The Three-Tier Penalty Structure Hits Your Wallet Hard

As of 2024, the IRS charges $60 per form if you file within 30 days of the deadline, $120 per form if filed between 31 days and August 1, and $310 per form if filed after August 1 or not at all. Each 1099-NEC you issue late gets penalized separately. File 10 forms 29 days late? That's $600. Wait 35 days? Now it's $1,200.

When you're paying multiple contractors, a single missed deadline can cost thousands. Lettuce maintains an accurate vendor database year-round — tracking payments, tax IDs, and totals — so your 1099s are prepared with zero math errors that could trigger additional penalties.

Intentional Disregard Penalties Have No Limits

Skip filing intentionally and face $630 per form with no maximum cap. Unlike the tiered penalties that have annual limits for small businesses, intentional disregard penalties can pile up indefinitely. The IRS procedures make clear that this is their harshest penalty tier. When e-filing takes minutes, there's no reason to risk this exposure.

1099-NEC Deadlines Are Different From Other Forms

Form 1099-NEC must be filed with the IRS and furnished to contractors by January 31, whether you file on paper or electronically. Most other 1099 forms give you until February 28 (paper) or March 31 (electronic) to file with the IRS. Since solopreneurs typically issue 1099-NEC for services, remember that the January 31 deadline applies to both copies. No separate extension for the IRS filing.

This compressed timeline is where many solopreneurs get caught. January 31 hits right after holiday chaos and year-end client work. Lettuce handles the actual filing automatically, so you're never scrambling to meet this early deadline while closing out Q4 invoices and preparing personal taxes.

How to Avoid or Reduce 1099 Penalties (And Never Face Them Again)

Let's handle two things: what to do if you've already missed the deadline, and how to make sure you never face these penalties again.

Avoid or Reduce Penalties — Moves That Work Right Now

You have more control than you think. Smart moves right now can save you hundreds of dollars per form.

How can I reduce or avoid the 1099 late filing penalty? Here are your fastest options:

• File immediately. 29 days late beats $120 or $310 territory.
• E-file with correct TINs using IRS systems for timestamped proof and faster processing.
• Submit corrected 1099-NEC forms quickly to prevent compounding penalties for the same mistake.
• Document reasonable causes, like software failures or natural disasters, for penalty relief requests.
• Automate next year's filings to avoid missed deadlines. Filing today keeps you in the lowest penalty tier. That's smart money management for this year. Automating for next year means you'll never face these penalties again.

Lettuce automatically prepares and files 1099-NECs forms at year-end for any contractor you've paid $600 or more, turning chaotic manual compliance into predictable, hands-free tax management

Missed the Deadline as a Freelancer? Do This Today

If you hired contractors and missed January 31**,** File your 1099-NECs immediately to stay in the lowest penalty tier. The IRS penalty structure shows filing within 30 days costs $60 per form, but waiting pushes you into the $120 tier after day 30.

Here's what makes this expensive:

• You face two separate penalties: one for failing to file with the IRS and another for not furnishing copies to contractors.
• Both penalties can apply to the same form, significantly increasing your total costs.

If you're a freelancer waiting for 1099s from clients: Good news. Their late filing doesn't create penalties for you. However, you must still report all income on your tax return, even without the required forms.

What to do:

• Use bank statements, invoices, or payment records to calculate your earnings.
• Report everything you earned. The IRS expects this regardless of whether clients send paperwork.
• Track deadlines better next year with a self-employed tax calendar.

Take action now if you hired contractors and missed January 31—file your 1099-NECs immediately to stay in the lowest penalty tier. The IRS penalty structure shows filing within 30 days costs $60 per form, but waiting pushes you into the $120 tier after day 30. You face two separate penalties: one for failing to file with the IRS and another for not furnishing copies to contractors. Both can apply to the same form, significantly increasing your total costs.

What happens if you miss the 1099 deadline as a freelancer waiting for forms from clients? Good news—their late filing doesn't create penalties for you. However, you must still report all income on your tax return, even without the required forms. Use bank statements, invoices, or payment records to calculate your earnings. Track these deadlines better next year with a self-employed tax calendar—the IRS expects you to report everything you earned, regardless of whether clients send their paperwork.

1099 Late Filing Penalty FAQs

Smart questions deserve straight answers. When you're juggling client work and tax deadlines, knowing exactly where you stand can save you hundreds of dollars and hours of stress.

Can I file a 1099 late without paying a penalty?

Generally, no, but you can request relief. The IRS offers penalty relief for reasonable causes like illness or software failures. You can also qualify for first-time penalty abatement if you've been compliant previously. File immediately to minimize penalties—29 days late costs $60, but waiting until day 31 jumps to $130.

What if I paid a contractor $560? Do I still need to issue a 1099-NEC, and what happens if I don't?

No 1099-NEC required. The IRS threshold is $600 or more for nonemployee services. Payments under $600 don't trigger 1099-NEC filing requirements, so no penalties apply.

Do I get penalized twice if I miss both the IRS filing and the contractor copy deadlines?

Yes, you face separate penalties. The IRS charges one penalty for failing to file with them and another for failing to furnish the recipient copy. According to IRS Publication 1586, these are distinct requirements with separate penalty assessments under different tax code sections.

What's the difference between 1099-NEC and 1099-MISC penalties?

The same penalty structure applies to both forms. The IRS penalty rates are identical: $60 for up to 30 days late, $130 for 31 days through August 1, and $330 after August 1. The form type doesn't change your penalty exposure; timing does.

Can I get an extension for 1099 filing?

Yes, but it's limited. Form 8809 provides a 30-day extension for filing with the IRS, but you must request it before the original deadline. There's no automatic extension like personal tax returns. For recipient copies, you need a separate fax request to extend that deadline.

Turn Penalties Into Savings With Lettuce

Late 1099 filing penalties range from $60 to $340 per form, but you can avoid them entirely with the right system. Filing within 30 days of missing a deadline saves money, but preventing missed deadlines saves even more.

Instead of worrying about penalties, automated deadline monitoring for freelancers eliminates penalty risk while freeing up your time for client work. Lettuce handles contractor payments, tracks deadlines, and submits forms on time with audit defense included. Most solos save thousands annually and reclaim 10+ hours monthly. No more penalty surprises.

Ready to put your 1099 compliance on autopilot? Start with Lettuce today and turn tax deadlines into competitive advantages.