An LLC taxed as an S Corporation generally does not get a 1099 from its clients. Once the IRS accepts the S Corp election, the LLC is treated as a corporation for federal tax purposes, and the long-standing corporate exemption from 1099-NEC and 1099-MISC reporting applies to it.1Internal Revenue Service. LLC Filing as a Corporation or Partnership Two payment categories override that exemption, and a handful of related rules trip people up, so the short answer needs some detail behind it.
Why the S Corp Election Blocks Most 1099s
Businesses paying for services don’t send a 1099-NEC or 1099-MISC to a corporation. When an LLC files Form 2553 and the IRS processes the S Corp election, that LLC becomes a corporation for reporting purposes, so its clients drop it from their 1099 lists. The S Corp reports the income itself on Form 1120-S, which makes the informational return redundant.2Internal Revenue Service. 2025 Instructions for Form 1120-S
This is a genuine administrative benefit compared to operating as a sole proprietor or a single-member LLC taxed as a disregarded entity. Those structures collect a 1099 from every client paying $600 or more, and each of those forms is a piece of paper the IRS can cross-reference against the return. As an S Corp, you sidestep that paper trail for most payment types.
The Exceptions That Still Trigger a 1099 to Your S Corp
Two payment categories are reported to corporations anyway, and both come up often enough that S Corp owners should know them.
Attorney fees. If a business pays a law firm $600 or more in a year, it must issue a 1099-NEC even when the firm is a corporation or S Corp. The IRS carves out legal services specifically because legal fees are a common area of underreporting.3Internal Revenue Service. Instructions for Forms 1099-MISC and 1099-NEC So if your S Corp is a law practice, expect 1099-NECs from business clients.
Medical and healthcare payments. Payments of $600 or more for medical or health care services are reported in Box 6 of Form 1099-MISC, and the corporate exemption does not apply. This catches payments to corporate-owned medical practices that would otherwise slip through.4Internal Revenue Service. Instructions for Forms 1099-MISC and 1099-NEC (04/2025) If your S Corp provides medical services, you’ll receive 1099-MISCs from business payers.
Real estate proceeds work the opposite way, worth noting only so you don’t assume it’s another exception. Form 1099-S actually exempts corporate transferors, so an S Corp selling commercial property does not trigger a 1099-S from the closing agent.5Internal Revenue Service. Instructions for Form 1099-S (Rev. April 2025)
The Credit Card and Payment App Carve-Out
Payments made by credit card, debit card, or through third-party networks like PayPal or Venmo Business are not reported on Form 1099-NEC or 1099-MISC. Those go on Form 1099-K, filed by the payment settlement entity.4Internal Revenue Service. Instructions for Forms 1099-MISC and 1099-NEC (04/2025) The current 1099-K reporting threshold is $20,000 and 200 transactions per payee.6Internal Revenue Service. IRS Issues FAQs on Form 1099-K Threshold Under the One, Big, Beautiful Bill So even if the attorney or medical exception would otherwise apply, a client paying your S Corp entirely by credit card owes you no 1099-NEC or 1099-MISC.
How Clients Know Your Entity Type
Your clients rely on the Form W-9 you give them to determine whether a 1099 is required. On the W-9, you identify your federal tax classification. An LLC that has elected S Corp status checks the LLC box and enters “S” for the tax classification code. That single character tells the client’s accounts payable team that the corporate exemption applies.
Skipping the W-9, or returning one with a missing or incorrect taxpayer identification number, creates a real problem on the client’s side. Without a valid TIN, the payer is required to withhold 24% of the payment as backup withholding and send it to the IRS.7Internal Revenue Service. Backup Withholding That turns a routine payment into a withholding headache and can delay funds, so return W-9s promptly and accurately.
Not Getting a 1099 Doesn’t Reduce What You Owe
The corporate exemption is a paperwork shield, not a tax break. Your S Corp still reports all of its gross income on Form 1120-S, whether or not a 1099 arrives. Clients who paid you $600 or more but had no obligation to issue a form still expect that income on your books, and the IRS still expects it on your return. Treat the missing 1099 as an administrative convenience only.
Your S Corp Still Has to Issue 1099s
The S Corp election shields you from receiving most 1099s, but it does nothing to reduce your obligations as a payer. When your S Corp pays an independent contractor, freelancer, or unincorporated vendor $600 or more during the year, you must issue the appropriate 1099, just like any other business.8Internal Revenue Service. Am I Required to File a Form 1099 or Other Information Return?
Use Form 1099-NEC for non-employee compensation, meaning payments for services performed by someone who isn’t your employee.9Internal Revenue Service. About Form 1099-NEC, Nonemployee Compensation Use Form 1099-MISC for rent, royalties, prizes, and other categories that hit the $600 threshold (or $10 for royalties).10Internal Revenue Service. About Form 1099-MISC, Miscellaneous Information
You do not issue a 1099 to another corporation, with the same attorney and medical exceptions applying in reverse: if your S Corp pays a law firm or a medical provider $600 or more, you issue the form even if that vendor is incorporated. Collect a W-9 from every vendor before paying them so you know their entity type before year-end.
The 1099-NEC is due to both the recipient and the IRS by January 31, whether filed on paper or electronically.4Internal Revenue Service. Instructions for Forms 1099-MISC and 1099-NEC (04/2025) Businesses filing 10 or more information returns in a year must file electronically, and that count aggregates 1099s and W-2s together.11Internal Revenue Service. Publication 1099 General Instructions for Certain Information Returns – For Use in Preparing 2026 Returns
Paying Yourself: W-2, Never a 1099
One misconception worth clearing up, because getting it wrong is the most expensive mistake an S Corp can make. If you own the S Corp and perform services for the business, you are its employee. You cannot pay yourself on a 1099-NEC as if you were an outside contractor. The S Corp must put you on payroll and issue a W-2, with federal income tax withholding and FICA taxes deducted from each paycheck.12Internal Revenue Service. Independent Contractor Defined
After a reasonable salary has been paid through payroll, remaining profits can be distributed to you and pass through on Schedule K-1 to your personal Form 1040.13Internal Revenue Service. S Corporations The IRS requires that the salary component be “reasonable” for the work performed. Issuing yourself a 1099 to avoid payroll taxes gets treated as a failure to withhold and pay employment taxes on what should have been wages, and for a controlling owner the IRS typically treats that as intentional. Section 3509 relief, which reduces the FICA liability for good-faith misclassification of ordinary workers, does not apply to intentional disregard, so the S Corp ends up owing the full tax plus penalties and interest.
So the practical rule: your S Corp usually won’t get a 1099, and when it does the reason is almost always attorney fees or medical payments. Your own reporting obligations, and the requirement to run owner pay through payroll, sit outside that answer and don’t change with the election.