W-2, 1099 and Other Tax Forms

The story: Jade’s tax folder

Jade sorts tax forms from the mailbox into a folder and adds a page for money that came with no form.

1. Narrator: It’s January, and Jade had a busy year. There was a café job, a design gig for a shop, babysitting paid by app and savings interest.
2. Jade: Forms are showing up. A W-2 from the café, and a 1099-NEC from the shop.
3. Narrator: Each form reports income to the IRS too. Whoever sends Jade a form sends the IRS a copy.
4. Jade: No form came for babysitting. So that money doesn’t count, right?
5. Narrator: It still counts. Small amounts often come with no form, but income is income, form or not.
6. Jade: Then I’ll keep a folder for every form, plus my own log for money with no form.
7. Narrator: Gather every form, and count income even without one.

What you’ll learn

1. The W-2

   An employer sends each employee a W-2 early in the year. It shows what that job paid and the taxes held back. Two jobs means two W-2s.

2. The 1099 family

   Contract work for a business may bring a 1099-NEC. Payment apps and platforms may send a 1099-K. Bank interest may bring a 1099-INT. Each form only comes above a set amount, shown on the fact card. Small amounts often come with no form.

3. No form? Still income

   Cash, tips and small app payments count as income even when no form arrives. A simple log of what you earned keeps track of it. A lesson on cash, apps and tips is coming.

4. The IRS has copies

   Whoever sends you a tax form sends the IRS a copy. If a form is missing or wrong, ask the sender for it or for a corrected one. Income left off a return can lead to letters from the IRS later.

Key words

W-2

the form an employer sends showing your pay and the taxes held back

1099-NEC

a form a business may send for contract work it paid you for

1099-K

a form payment apps and platforms may send for payments you got

1099-INT

a form a bank may send for interest it paid you

Common questions

What is a 1098-T?

A form a college sends showing tuition paid. It doesn’t report income, but it can matter for education tax breaks.

Remember this

Gather every form, and count income even without one.

Try it: Make a tax folder checklist

1. List every way the sample person, or you, got paid this year.
2. Next to each, write the form you’d expect: W-2, a 1099, or none.
3. Add a line for your own income log, for money that came with no form.

Make a checklist for a tax folder.

Live facts

Numbers that change over time, with when they were last checked and where they come from.

• When a 1099-NEC is sent, and the deadline

  Source: IRS.gov(opens in a new tab)

• Payment apps and the 1099-K

  Source: IRS.gov(opens in a new tab)

• When a bank sends a 1099-INT for interest

  Source: IRS.gov(opens in a new tab)

• What to do if a W-2 is missing or wrong

  Source: IRS.gov(opens in a new tab)