How to File 1099-NEC Electronically
Complete guide to IRS FIRE system, e-filing requirements for 10+ forms, third-party services, and step-by-step electronic filing process.
IRS E-Filing Requirements
If you're filing 10 or more 1099-NEC forms, electronic filing is mandatory. The IRS no longer accepts paper filing for 10+ forms. This applies to total information returns filed, not just 1099-NEC — if you're filing 8 NEC forms + 3 MISC forms = 11 total, you must e-file all of them.
Instant confirmation from IRS when accepted. Faster processing than paper filing. Automatic validation catches errors before submission. No printing, postage, or mail delays. Immediate proof of filing for your records. Reduces risk of forms getting lost in mail. Available 24/7 until deadline.
FIRE (Filing Information Returns Electronically) is the IRS's free e-filing system for information returns. Requires initial setup and TCC (Transmitter Control Code) application. Steep learning curve but free for any number of forms. Best for businesses filing 100+ forms annually or those wanting full control.
IRS-approved vendors handle e-filing for you. Costs typically $1-5 per form. Much easier than FIRE system for small businesses. Upload form data or import from accounting software. Service submits to IRS electronically. You receive confirmation. Popular options: Tax1099, Track1099, eFileMyForms.
E-Filing Requirements at a Glance
Forms filed = Must e-file (IRS requirement)
Forms = Consider professional service or software
Forms = E-file optional but recommended
Step-by-Step: IRS FIRE System
How to set up and use the IRS's free electronic filing system
Apply for Transmitter Control Code (TCC)
Visit IRS FIRE website and complete Application for TCC. Provide your business information: EIN, business name, contact details. Wait 45 days for IRS to process and mail TCC to you. You need TCC before you can submit any forms electronically through FIRE. Apply by mid-November to ensure TCC arrives before January filing deadline.
Create FIRE Account and Set Up Access
Once you receive TCC, create account at IRS FIRE portal. Set up secure access credentials. Register your TCC in the system. Configure your filing specifications: file format (ASCII or XML), transmission method, contact information. Test your connection before actual filing deadline to ensure everything works properly.
Format Your 1099-NEC Data Properly
FIRE requires specific file format: ASCII text file or XML format following IRS Publication 1220 specifications. Each record must have exact field lengths and positions. Include Transmitter "T" record, Payer "A" record, Payee "B" records for each contractor, and End of Transmission "F" record. Formatting errors cause rejection. Many businesses use software to generate properly formatted files rather than manual creation.
Upload and Submit Through FIRE Portal
Log into FIRE system with your credentials. Upload your formatted data file. FIRE validates file format and data. If errors detected, system rejects file with error messages — fix and resubmit. If accepted, receive confirmation number immediately. Download confirmation receipt for your records. Entire process takes minutes once file is properly formatted.
Provide Copy B to Contractors
E-filing with IRS doesn't eliminate need to send Copy B to contractors. You must still provide Copy B to each contractor by January 31st via mail or email. Generate Copy B from same data you e-filed. Send with brief cover letter. Keep proof of mailing/delivery. Contractors need Copy B for their personal tax return filing.
FIRE System Challenges
While FIRE is free, it has significant drawbacks for small businesses:
- • 45-day TCC wait time: Must plan months ahead, can't wait until January
- • Complex file formatting: Requires technical knowledge or software to create proper files
- • Steep learning curve: Interface not user-friendly, extensive documentation to read
- • No customer support: Limited IRS help if you encounter problems
- • Annual re-certification: Must verify account and TCC each filing season
- • Error handling: Cryptic error messages difficult to troubleshoot
Third-Party E-File Services
User-friendly interfaces designed for non-technical users. Simple data entry forms. No complex file formatting required. Step-by-step guidance through process. Customer support available if you need help.
No 45-day TCC wait. Create account and start filing immediately. Perfect for businesses that didn't plan ahead or need last-minute filing. Can file on January 30th if necessary (though not recommended to cut it that close).
Services generate all required copies: IRS e-filing handled automatically. Copy B PDFs for contractors. State copies if needed. Your record copies. Some services even mail Copy B to contractors for you.
Recommended E-Filing Options by Business Size
| Number of Forms | Best Option | Estimated Cost |
|---|---|---|
| 1-9 forms | Our generator + mail to IRS (optional e-file) | $9-24 (no e-file needed) |
| 10-50 forms | Third-party service (Tax1099, Track1099) | $50-200 total |
| 51-100 forms | Accounting software with e-file (QuickBooks, Xero) | $100-400 total |
| 100+ forms | IRS FIRE system (free) or payroll service | Free to $500+ |
Electronic Filing FAQs
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Skip the FIRE System Complexity
Generate professional 1099-NEC forms with our easy-to-use system. Download PDFs and file electronically through trusted third-party services.