Yes, there are certain instances when employers must send a 1099 form for reimbursements to their employees. Businesses, in general, must issue a 1099 for the non-incorporated contractors that they paid $600 or more in the previous calendar year.
Issue a 1099 if you:
- Reimbursed your employees for any expenses
- Your company’s policy does not require receipts
An employee must receive a 1099 form if your company’s total reimbursements for the year exceed $600.
Use Schedule C (Form 1040) to itemize specific business deductions. Reimbursed expenses may include:
- Travel
- Equipment
- Continued education
- Specified services
Review which expenses qualify under the categories, including tuition and mileage, and which do not require you to send 1099s to your employees.
People Also Ask
- Do I need to send a W-2 form for reimbursements to employees? – Yes, you should report substantiated employee business expense reimbursements on each applicable Form W-2, Wage and Tax Statement in Box 12.
- Can employees take deductions based on mileage? – Yes, if an employee uses their car for business, charity, medical or moving purposes, they may be entitled to a deduction. In 2025, the standard mileage rate for self-employed individuals and businesses is 70 cents per mile.
Import data from a variety of sources and calculate the selected fields before you electronically file or print any of your 1099s. Download our free, easy-to-use 1099-etc Demo software today for a full walk-through of the system.