US tax for an owner abroad · A term for founders abroad
What is Form 1099-NEC?
The form a US company files for each US contractor it paid $2,000 or more in a year, due to the contractor and the IRS by 31 January.
Checked against the IRS's instructions and the states' own rules. Reviewed by Saais Patel, compliance reviewer.
Term 41 of 105 in the glossary, filed under F.IRS: instructions for Forms 1099-MISC and 1099-NEC
Form 1099-NEC, for a founder abroad.
Payments to a US contractor are reported on Form 1099-NEC, to the contractor and the IRS, by 31 January. The threshold rose from $600 to $2,000 from the 2026 tax year, and it can be adjusted for inflation from 2027.
- What's reported: payments by bank transfer or cheque. Card and payment-app payments are reported by the payment company on a 1099-K instead.
- What you need first: a W-9 from the contractor. Without a taxpayer number, the company has to hold back 24% of each payment for the IRS.
- Who isn't reported: contractors abroad doing work outside the US, who give a W-8BEN instead, and most corporations.
Your Contractors page builds the list from your books and we prepare each form. Filing them with the IRS is $49.
Sources: IRS: instructions for Forms 1099-MISC and 1099-NEC; IRS: backup withholding.
Read next · guide · 3 minHiring US contractors from abroad: the W-9, the 1099-NEC, and the line you must not crossWhat founders ask next.
- What is the 1099-NEC threshold in 2026?
- $2,000 paid to a contractor during the year, up from $600 through 2025.
- Do I file a 1099-NEC for a contractor paid through PayPal or by card?
- No. The payment company reports those on Form 1099-K. Form 1099-NEC is for bank transfers and cheques.
- Do I file a 1099-NEC for a contractor outside the US?
- No, for work done outside the US. Keep their W-8BEN on file instead. The contractors guide covers the rest.
03 · See also
- US tax for an owner abroadForm W-9The form a US person or US company gives a payer with its tax number; what a multi-member LLC or corporation gives a US client.Read the term
- US tax for an owner abroadIndependent contractorSomeone who provides services on their own terms rather than as an employee; paid without payroll, and reported on Form 1099-NEC if in the US.Read the term
- US tax for an owner abroadDisregarded entityA single-member LLC the IRS ignores for income tax, treating its income as the owner's; it still files Form 5472 if the owner is foreign.Read the term
- US tax for an owner abroadPass-through taxationTax treatment where a company pays no income tax itself and its profit is taxed to its owners, as with an LLC or a partnership.Read the term
Ready when you are
Answer the questions. We do the filing.
It takes about four minutes. You see the whole order, Wyoming fee included, before anything is charged.
You're startingLLC · WY
Start a companyLaunch · $351.40 · Wyoming fee included