topic 1099-NEC required? in Investors & landlords

1099-NEC required?

Flutesss — Mon, 09 Mar 2026 08:16:39 GMT

I own one rental property which is managed by a property manager. I do not have a "trade or business" involving rental property. I do actively participate as I approve repairs, improvements, and tenants recommended by my property manager.

I have two questions:

Last year, I directly paid a contractor to install new flooring. Must I issue a 1099-NEC to the installer of the flooring?

It is my understanding I do not need to issue a 1099-NEC to my property manager, correct?

Thank you for your time!

Re: 1099-NEC required?

ColeenD3 — Sat, 12 Mar 2022 13:33:55 GMT

It depends whether or not you qualify for the QBI. This means that you are going to treat your rental as an actual trade or business rather than a passive activity.

Trade or business reporting only.

Report on Form 1099-NEC only when payments are made in the course of
your trade or business. Personal payments are not reportable.

Re: 1099-NEC required?

Carl — Sat, 12 Mar 2022 14:14:18 GMT

Generally, the passive activity of long term residential rental real estate is not required to issue a 1099 ever. However, there are some things that are a "Grey area" in the IRS pubs. Basically, if you are claiming QBI, this is one of the grey areas when it comes to 1099's. In such a case where you are claiming QBI on the activity, I'd recommend you issue the 1099-NEC just so you "know" all your bases are covered without question.

Re: 1099-NEC required?

Flutesss — Sat, 12 Mar 2022 19:07:08 GMT

Thank you much! I looked at my tax forms and they were giving me a $10 credit for a QBI deduction. I unchecked the box in the TurboTax questions that asked if I am an active participant (even though I do make the final decisions about tenants, repairs, etc. which my property manager submits to me.) Is this all I need to do to be sure I'm not considered a business and to remove the necessity of filing the 1099-NEC? I have only one rental property and it is passive income. Thank you again for your time!

Re: 1099-NEC required?

Carl — Sat, 12 Mar 2022 23:59:21 GMT

That'll work just fine. Don't take the QBI, and don't worry about issuing any 1099's then. Besides, a $10 QBI for me is absolutely worthless. Doesn't make one single penny of difference to your tax liability anyway.