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Nonemployee Payments Reported on Form 1099-NEC When these conditions apply, businesses must report the following payments as nonemployee compensation: Professional service fees, including payments to attorneys, accountants, architects, contractors, and engineers Fee-splitting and referral fees Witness and expert witness fees Payments for services, including parts and materials Commissions paid to nonemployee salespersons Fees and reimbursements paid to independent contractors Payments to nonemployee entertainers Service exchanges between individuals or businesses Taxable fringe benefits provided to nonemployees Oil and gas payments for working interests Directors fees Insurance salesperson commissions Lottery ticket sales commissions Golden parachute payments Entertainment facility expenses Payments made under Section 530 employee classification Transportation service payments, including taxicab and limousine drivers Form 1099-MISC By comparison, businesses use Form 1099-MISC to report miscellaneous income that does not qualify as nonemployee compensation

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