Entity eligibility guide
Do Corporations Get 1099s? The Exemption and Its Exceptions
Generally, corporations do not receive Form 1099-MISC or Form 1099-NEC for many ordinary business payments because the corporate exemption applies. The exemption generally covers C corporations, S corporations, and LLCs taxed as either. Review is still required for listed exceptions, including attorneys' fees, gross proceeds paid to attorneys, medical and health care payments, certain cash fish purchases, substitute payments, and certain federal executive agency service payments. Payment method, payment year, and backup withholding also matter. Source: IRS Instructions for Forms 1099-MISC and 1099-NEC. This page supports firm review workflows and is not tax or legal advice.
Who this page is for
Bookkeepers, accounting firm staff, and tax professionals reviewing incorporated vendors before filing-season decisions. The sibling guides linked below provide more detail for S corporations and LLCs with elected or disregarded tax classifications.
The corporate exemption
The IRS instructions generally exclude payments to corporations from Form 1099-MISC and Form 1099-NEC reporting. This generally includes:
- C corporations
- S corporations
- LLCs treated as C corporations
- LLCs treated as S corporations
The exemption follows federal tax classification rather than the suffix in the vendor name. Source: IRS Instructions for Forms 1099-MISC and 1099-NEC.
The corporate exemption is one part of the review. Staff should also confirm the payment category, payment method, payment year, and whether backup withholding occurred.
Does a C corporation get a 1099?
Generally no for payment categories covered by the corporate exemption. A C corporation can still require review when the payment falls into an exception category, such as legal services or medical and health care payments.
The same general treatment applies to an LLC classified as a C corporation. Confirm the classification from Form W-9 before applying the exemption.
Does an LLC taxed as a C corporation get a 1099?
Generally no for ordinary payment categories covered by the corporate exemption. A non-disregarded LLC identifies its classification as C, S, or P on Form W-9. A disregarded LLC follows its owner's classification. Source: IRS Instructions for the Requester of Form W-9.
The listed corporate exceptions still apply. For the full LLC decision path, including partnership and disregarded-entity treatment, see the LLC eligibility guide linked below.
Payments to corporations that still require review
The 2026 IRS instructions identify corporate payment categories that generally remain reportable.
Form 1099-MISC exceptions
- Cash payments for fish purchased for resale
- Medical and health care payments
- Substitute payments in lieu of dividends or tax-exempt interest
- Gross proceeds paid to an attorney
Form 1099-NEC exceptions
- Attorneys' fees for legal services
- Payments by a federal executive agency for vendor services
When a corporate W-9 appears with one of these payment categories, route the record to the firm's qualified reviewer instead of applying the exemption automatically. Source: IRS Instructions for Forms 1099-MISC and 1099-NEC.
Legal payments to corporations
The corporate exemption does not apply to payments for legal services.
For payments made in 2026:
- Attorneys' fees of at least $2,000 paid in the course of a trade or business are generally reported on Form 1099-NEC.
- Gross proceeds of at least $600 paid to an attorney in connection with legal services are generally reported on Form 1099-MISC.
These rules apply to incorporated law firms and other corporate legal-service providers. Sources: IRS Instructions for Forms 1099-MISC and 1099-NEC and Public Law 119-21, section 70433.
For payments made in 2025, the attorneys' fee threshold in the 2025 instructions is generally $600. Source: IRS 2025 Instructions for Forms 1099-MISC and 1099-NEC.
Medical and health care payments to corporations
The corporate exemption generally does not apply to payments for medical or health care services provided by corporations, including professional corporations.
For payments made in 2026, the threshold for affected medical and health care payments is generally $2,000. For payments made in 2025, the corresponding threshold in the 2025 instructions is generally $600. Certain tax-exempt or government-operated hospitals and extended-care facilities are excluded under the instructions. Sources: IRS 2025 instructions, Public Law 119-21, section 70433, and IRS Instructions for Forms 1099-MISC and 1099-NEC.
Payment method changes the review path
Payments made by credit card, payment card, or certain third-party payment networks are generally reported by the payment settlement entity on Form 1099-K. Those transactions are generally not reported by the payer on Form 1099-MISC or Form 1099-NEC. Sources: IRS Instructions for Forms 1099-MISC and 1099-NEC and IRS About Form 1099-K.
Separate card and processor payments before applying the corporate exemption or an exception rule.
The W-9 supplies the classification evidence
Use the federal tax classification shown on Form W-9 rather than relying on terms such as Inc., Corp., or LLC in the vendor name.
Form W-9 supplies the payee's name, taxpayer identification number, and federal tax classification for information-return workflows. Source: IRS About Form W-9.
The requester instructions explain that a non-disregarded LLC identifies its classification as C, S, or P, while a disregarded LLC follows its owner's classification. Source: IRS Instructions for the Requester of Form W-9.
Thresholds depend on the payment year and category
There is no single permanent 1099 threshold.
- For payments made in 2025 and filed in early 2026, the 2025 IRS instructions use $600 for many common Form 1099-MISC and Form 1099-NEC categories. Source: IRS 2025 Instructions for Forms 1099-MISC and 1099-NEC.
- For payments made in 2026 and filed in early 2027, Public Law 119-21 sets $2,000 for affected categories, including attorneys' fees and medical and health care payments. Source: Public Law 119-21, section 70433.
- Gross proceeds paid to an attorney retain a separate $600 threshold.
- Cash payments for fish purchased for resale follow a separate category-specific rule that requires payment-year review.
- Substitute payments in lieu of dividends or tax-exempt interest generally use a separate $10 threshold.
- Backup withholding can require reporting regardless of the amount paid.
A large payment does not override the corporate exemption when the payment category remains exempt. Apply thresholds only after identifying the correct category and exception status.
Firm review workflow
- Confirm the vendor's legal name and federal tax classification from Form W-9.
- Record the payment year and use the matching IRS instructions edition.
- Identify the payment category.
- Separate credit card and qualifying payment-network transactions.
- Check the corporate-exception list before applying the exemption.
- Confirm whether backup withholding occurred.
- Route legal, medical, incomplete, conflicting, or otherwise uncertain records to the firm's qualified reviewer.
Vendor readiness checklist
| Area | Check | Why it matters |
|---|---|---|
| Entity evidence | Confirm the corporate classification shown on Form W-9. | The vendor-name suffix does not establish federal tax classification. |
| Payment year | Record the year the payment was made. | Directs the review to the correct IRS instructions edition. |
| Payment category | Separate ordinary services from legal, medical, fish, substitute-payment, and other exception categories. | Exception categories can override the corporate exemption. |
| Payment method | Separate card and payment-network transactions. | Those transactions generally follow Form 1099-K reporting. |
| Backup withholding | Confirm whether federal income tax was withheld. | Reporting can be required regardless of payment amount. |
| Record readiness | Check legal name, address, W-9 status, and TIN last4. | Improves the firm review handoff. |
| Escalation | Send unclear entity or payment records to a qualified reviewer. | Keeps the final decision with the firm. |
Prepare the vendor record for review
W9Finder organizes missing W-9 requests, vendor readiness issues, and review handoffs so the corporate-exemption review starts from more complete records.
FAQ
Do corporations get 1099s?
Generally no for payment categories covered by the corporate exemption. Listed exceptions include attorneys' fees, gross proceeds paid to attorneys, medical and health care payments, certain cash fish purchases, substitute payments, and certain federal executive agency service payments. Source: https://www.irs.gov/instructions/i1099mec
Do C corporations get 1099s?
Generally no for ordinary payment categories covered by the corporate exemption. Review is still required for listed exception categories and backup withholding. Source: https://www.irs.gov/instructions/i1099mec
Does an LLC taxed as a C corporation get a 1099?
Generally no for categories covered by the corporate exemption. Confirm the classification on Form W-9 and check whether the payment belongs to a listed exception category. Sources: https://www.irs.gov/pub/irs-pdf/iw9.pdf and https://www.irs.gov/instructions/i1099mec
Do incorporated law firms get 1099s?
Legal-service payments are an exception to the corporate exemption. Attorneys' fees are generally reported on Form 1099-NEC, and gross proceeds paid to an attorney are generally reported on Form 1099-MISC. The applicable threshold depends on the payment year and category. Source: https://www.irs.gov/instructions/i1099mec
Do incorporated medical providers get 1099s?
Medical and health care payments are a listed exception to the corporate exemption. Certain tax-exempt or government-operated facilities are excluded under the instructions. Review the payment method, payment year, threshold, and facility status. Source: https://www.irs.gov/instructions/i1099mec
Do credit card payments to corporations go on Form 1099-NEC or Form 1099-MISC?
Payments made by credit card or certain third-party payment networks are generally reported by the payment settlement entity on Form 1099-K rather than by the payer on Form 1099-NEC or Form 1099-MISC. Sources: https://www.irs.gov/instructions/i1099mec and https://www.irs.gov/forms-pubs/about-form-1099-k
Why does the payment year matter?
The 2025 instructions use $600 for many common categories. Public Law 119-21 sets $2,000 for affected categories in 2026, while legal gross proceeds, fish purchases, substitute payments, and other categories retain separate rules. Sources: https://www.irs.gov/pub/irs-prior/i1099mec--2025.pdf and https://www.congress.gov/119/plaws/publ21/PLAW-119publ21.pdf
Does W9Finder provide tax or legal advice?
No. W9Finder supports W-9 collection, vendor record cleanup, and firm review handoffs. Reporting decisions stay with the firm and its qualified reviewers.