1099 late filing penalty: the amounts, the tiers, and the relief paths

Who this page is for

This page is for payers and accounting or bookkeeping firms reviewing exposure from late, missing, or incorrect Forms 1099. It covers the federal information-return penalties under sections 6721 and 6722. Worker-classification penalties remain on our worker misclassification penalties page. Filed-form correction procedures remain on our corrected 1099 page when that route is live.

Separate return and payee-statement penalties

The IRS charges one penalty for each information return that was not filed correctly or on time and a separate penalty for each payee statement that was not provided correctly on time. The same timing tiers apply to both charges (https://www.irs.gov/payments/information-return-penalties).

A single Form 1099 can therefore create a return-filing charge and a payee-statement charge when both obligations were missed. Interest also accrues on penalties, with the starting date depending on the penalty type and amount (https://www.irs.gov/payments/information-return-penalties).

Penalty tiers for returns due in 2026

Penalty amounts attach to the calendar year in which the return or statement is due. Forms reporting 2025 payments are generally due in 2026, so the IRS due-2026 row applies (https://www.irs.gov/payments/information-return-penalties).

The IRS public penalty table lists $680 for intentional disregard. Part O of the 2025 General Instructions describes the intentional-disregard penalty as at least $680 per return or payee statement and confirms that no annual maximum applies (https://www.irs.gov/payments/information-return-penalties, https://www.irs.gov/instructions/i1099gi).

Annual maximums for returns due in 2026

Part O of the 2025 General Instructions gives the following annual maximums for the section 6721 return-filing penalty (https://www.irs.gov/instructions/i1099gi):

For this purpose, a small business has average annual gross receipts of $5 million or less for its three most recent tax years ending before the calendar year in which the returns were due. A shorter period applies when the business has existed for less than three tax years (https://www.irs.gov/instructions/i1099gi).

The section 6722 payee-statement penalty is separate and is applied in the same manner as the section 6721 return-filing penalty. Intentional disregard has no annual maximum (https://www.irs.gov/instructions/i1099gi).

Failure to file electronically

A filer required to file electronically may face a separate failure-to-e-file penalty when it files on paper without an approved waiver. For most information returns due in 2026 covered by the 2025 General Instructions, the maximum is $340 per return. The penalty applies only to the number of returns exceeding 10 and does not apply when the filer establishes reasonable cause (https://www.irs.gov/instructions/i1099gi).

The electronic-filing threshold is determined by aggregating information returns across form types. A filer required to file 10 or more information returns during the year generally must file them electronically unless an approved hardship waiver applies (https://www.irs.gov/instructions/i1099gi).

Relief and exceptions

Reasonable cause can remove the section 6721 failure-to-file penalty when the filer shows that the failure was due to reasonable cause rather than willful neglect. The 2025 General Instructions describe responsible conduct before and after the failure, significant mitigating factors, and circumstances beyond the filer's control as part of the analysis (https://www.irs.gov/instructions/i1099gi).

The instructions also provide two narrower rules:

• Missing or incorrect TINs do not require corrected returns when the filer meets the reasonable-cause criteria. The correct TIN must appear on the next original return the filer is required to file (https://www.irs.gov/instructions/i1099gi).
• A de minimis safe harbor exists for certain dollar-amount errors on information returns and payee statements. Its detailed limits and recipient-election rule appear in Part O (https://www.irs.gov/instructions/i1099gi).

Form 1099-NEC has no automatic extension of time to file under the 2025 General Instructions (https://www.irs.gov/instructions/i1099gi).

Notice 972CG

The IRS penalty page identifies Notice 972CG in the reasonable-cause process and instructs recipients to respond under the notice procedures before the proposed penalty is assessed (https://www.irs.gov/payments/information-return-penalties). Review the notice's form counts, failure categories, and filing records before preparing the response. A qualified tax professional should evaluate whether the documented facts support reasonable cause.

Amounts for later years

Information-return penalty amounts are adjusted annually and attach to the year due. This page uses the amounts for returns and statements due in 2026. The IRS has already published the inflation-adjusted amounts for returns and statements due in 2027 in Rev. Proc. 2025-32, including a $690 intentional-disregard amount for the general category (https://www.irs.gov/irb/2025-45_IRB).