id = "1099-the-threshold-is-the-years"
title = "The 1099-NEC threshold is the one in force for the year the payments were made"
rule = """
A payer reports payments to a payee aggregating the threshold or more in a
calendar year: $600 for payments made through December 31, 2025, and
$2,000 ("of $2,000 or more") for payments made after it (indexed for
inflation for calendar years after 2026, not yet known: never guessed). The
threshold is met at exactly the amount.
"""
status = "AUTHORITY"
sources = [
  "26 U.S.C. §6041(a), (h), §6041A(a)(2) (docs/spec/sources/irs-1099-thresholds.md)",
  "Pub. L. 119-21 §70433(a), (f): \"shall apply with respect to payments made after December 31, 2025\" (docs/spec/sources/irs-1099-payment-method.md)",
  "Instructions for Forms 1099-MISC and 1099-NEC (Rev. April 2025): $600",
]
tags = ["1099", "threshold"]

[setup]
currency = "USD"
fiscal_year_start = "01-01"
basis = "cash"
rounding = "half-away-from-zero"
cash_accounts = ["1000"]

[[setup.accounts]]
code = "1000"
name = "Bank"
type = "asset"

[[setup.accounts]]
code = "6000"
name = "Contract Labor"
type = "expense"

[[setup.payees]]
name = "Riley Chen"
form = "1099-NEC"

[[setup.payees]]
name = "Cedar Studio"
form = "1099-NEC"

[[events]]
date = "2025-11-01"
description = "Illustration"
payee = "Riley Chen"
lines = [
  { account = "6000", side = "debit", amount = "600.00" },
  { account = "1000", side = "credit", amount = "600.00" },
]

[[events]]
date = "2026-02-01"
description = "Illustration"
payee = "Riley Chen"
lines = [
  { account = "6000", side = "debit", amount = "1999.99" },
  { account = "1000", side = "credit", amount = "1999.99" },
]

[[events]]
date = "2026-02-01"
description = "Photography"
payee = "Cedar Studio"
lines = [
  { account = "6000", side = "debit", amount = "2000.00" },
  { account = "1000", side = "credit", amount = "2000.00" },
]

# By hand: 2025, Riley 600.00 against $600: reportable (exactly the
# threshold). 2026, Riley 1,999.99 against $2,000: under; Cedar 2,000.00:
# reportable.
[[expect]]
query = "vendor_1099"
payee = "Riley Chen"
from = "2025-01-01"
to = "2025-12-31"
values = { status = "reportable", threshold = "600.00", paid = "600.00", excluded_card = "0.00", undetermined = "0.00", not_reportable = "0.00" }

[[expect]]
query = "vendor_1099"
payee = "Riley Chen"
from = "2026-01-01"
to = "2026-12-31"
values = { status = "under_threshold", threshold = "2000.00", paid = "1999.99", excluded_card = "0.00", undetermined = "0.00", not_reportable = "0.00" }

[[expect]]
query = "vendor_1099"
payee = "Cedar Studio"
from = "2026-01-01"
to = "2026-12-31"
values = { status = "reportable", threshold = "2000.00", paid = "2000.00", excluded_card = "0.00", undetermined = "0.00", not_reportable = "0.00" }