Brand New Changes in 1099 Forms for Realtors in 2021

Services for Real Estate Pros with Anchor Tax Relief LLC 00100741-EA

If there's one thing I've learned in providing bookkeeping and tax services to Realtors over the past 15 years, it's that the only thing that's constant is change!

Whether you are…

  • a real estate broker who paid agent commissions in 2020, or
  • an agent who paid a virtual assistant last year

… there are new rules when it comes to filing 1099s in January.

The Rules

Here’s the rules for 2021:

  • Realtors no longer send 1099-MISC forms in these situations. Instead they file the new 1099-NEC form.
  • Who must file? If you paid any individual a total of $600 or more during the year, you are required to file the new 1099 NEC.
  • The filing deadline for the new 1099 NEC is Jan 31, 2021

The Exceptions

Now before you call your accountant, or run down to Office Depot to buy 1099-NEC forms, you need to be aware of a couple exceptions to the 1099 filing rules:

Exception 1: If you paid the contractor electronically (e.g., PayPal, bank debit card, Venmo, Apple Pay) as opposed to paying by cash or check, you are no longer required to file a 1099.

Exception 2: if the contractor is incorporated (C Corp or S Corp), you are not required to file a 1099. You find out whether the contractor is incorporated by requesting a Form W-9 from the contractor. (Note: you must determine from the W-9 form the contractors tax status (C Corp, S Corp), not legal status (LLC, Corp).

New 1099 Form versus the Old

Real estate brokers and agents should quickly familiarize themselves with the new1099-NEC (preview here). This is a new form specifically for reporting non-employee compensation—currently defined as payments to individuals not on payroll on a contract basis to complete a project or assignment. This would include real estate agents, virtual assistants, cleaning services, remodelers, and other self employed contractors

The old 1099-MISC form is still around, it’s just used to report miscellaneous income such as rent or payments to an attorney. And the new deadline for the old 1099-MISC form is March 1, 2021.

If you have questions or need assistance filing 1099s for your contractor payments in 2020, contact me at 75-312-0098 or

Jim Flauaus, EA

Comments (2)

Jim Flauaus
Anchor Tax Relief LLC - Chesapeake, VA
Your Tax Problem Solver

Please note the new form: 1099 NEC.  And please note the old form (1099 MISC) has a new deadline this year!

Jan 18, 2021 05:23 AM
Debe Maxwell, CRS | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
The right Charlotte REALTOR!

Thanks for the heads-up Jim. I use to do all my 1099's. They updated to the new 1099-NEC forms for this year.

Jan 18, 2021 01:43 PM