If your brand pays US creators directly, the 1099-NEC filing threshold rises from $600 to $2,000 per payee per year for payments made starting in 2026 — a change from a budget reconciliation law signed in July 2025 (commonly called the One Big Beautiful Bill), with the first forms under the new rule due in early 2027. The same law also reversed course on the 1099-K threshold that applies to third-party payment networks like PayPal and Venmo: instead of phasing down to $600 as previously scheduled, that threshold is now permanently restored to $20,000 and more than 200 transactions a year. With both thresholds rising at once, far more creators than last year will get no 1099 from either path — but that doesn't make the income tax-free. Any brand that has been splitting creator payouts across multiple channels needs to reconcile its own per-creator totals before year-end.
What exactly changed, and when?
What changed is not what creators owe in tax — it's the line at which brands must file paperwork with the IRS. The reconciliation law signed in July 2025 raised the filing threshold for both Form 1099-NEC (nonemployee compensation) and Form 1099-MISC from $600 to $2,000 per payee per calendar year, effective for payments made after December 31, 2025. Forms covering 2026 payments will be the first filed under the new threshold, in early 2027, and from that point on the $2,000 figure itself will be indexed for inflation each year. The practical catch is that this is the first year under the new rule: any internal alert or automation your finance team built around the old $600 trigger is now quietly out of date for anything you pay from here on.
Why does it matter that the same law reverted the 1099-K threshold too?
A 2021 law had set third-party payment networks like PayPal and Venmo on a path from a $20,000-and-200-transaction 1099-K threshold down to just $600, though the IRS delayed enforcement repeatedly. The 2025 reconciliation law retroactively scrapped that phase-down and permanently restored the original, much higher threshold: a 1099-K is only required once gross payments exceed $20,000 and transaction count exceeds 200 in the same year — both conditions, not either. Some brands had quietly built their process around the assumption that the payment network itself would eventually catch the smaller payments, particularly for affiliate commissions or promo-code payouts routed through PayPal or Venmo. That backstop is gone. Payments through those rails now need to clear $20,000, not $2,000, before any 1099-K gets issued — so anything relying on that safety net will miss far more than it used to.
If you pay one creator through several channels, how does the threshold apply?
The $2,000 threshold applies to the total a single payer (the same brand, or the same tax ID) pays one creator across an entire year — not to each channel separately. If you pay a creator a content fee by direct invoice and also pay them promo-code commissions through an affiliate program run under the same brand name, both payments legally come from the same payer and should be added together to check whether the threshold is crossed. Example: a $1,300 production-fee invoice plus $900 in promo-code commissions from the same brand's affiliate program in the same year totals $2,200 — over the $2,000 line. The recurring problem is that marketing sees engagement and conversions, finance sees payment batches in a different system, and nobody owns the combined annual number that actually matters for 1099-NEC purposes. Layer in sub-affiliates or referral chains, and it often turns out no contract ever specified which party is actually responsible for filing.
If a creator doesn't get a 1099, do they still owe tax on it?
Yes. This change only raised the line at which a brand must file paperwork — it changed nothing about whether income a creator earned is taxable. Creators are still required to report every dollar they receive whether or not a 1099 shows up, and that reporting obligation is theirs, not the brand's. The risk that does sit with the brand runs the other way: the absence of a filed 1099 is not proof that no reportable payment happened, which matters if your own vendor payment records ever get audited. Spelling out, in the creator brief and contract, when a W-9 gets collected and who is responsible for filing is how a brand manages that risk on its own side.
What should brands check right now, before year-end?
Four things are worth sorting out once, this quarter, since this is the first year under the new rule. First, consolidate every channel that pays a creator — direct invoices, affiliate-platform commissions, manual PayPal payments — into one ledger that totals by creator (by tax ID), not by channel. Second, confirm in your contracts whether the affiliate platform or agency you use is the one filing 1099s on your behalf, or whether your brand is the payer of record — and fix any contract that leaves this unclear before its next renewal. Third, keep collecting a W-9 at first payment regardless of whether you expect to cross $2,000 that year, since you won't know for certain until year-end. Fourth, for programs with sub-affiliates or referral chains, put in writing which party in the chain is responsible for filing. The same fragmentation that makes per-creator totals easy to lose also makes it easy to lose track of which channel actually drove the sale. Hyperstar attributes realized revenue to individual creators in one place, so you're working from one number all season instead of reconciling scattered payment records after the fact. If you're auditing your Q4 payout process, get started.
