This tracker vs. tracking vendors in a spreadsheet
A spreadsheet is how most small-business bookkeepers already do this, and
for one filing season it can work fine: a column for total paid, a column
for entity type, and an IF formula that flags a row. The
problem is not the spreadsheet — it is that the formula is only as
current as whoever last edited it, and two rules changed for 2026 at once.
First, the reporting threshold rose from $600 to $2,000 for payments made
on or after 2026-01-01. A formula copied forward from last year's sheet
still says 600 until someone remembers to change it. Second,
a blanket IF(entity = "corp", "exempt", "check") rule leaves
out the one case that does not follow entity type: an attorney's own fees
for services are reportable no matter how the firm is organized. Getting
that exception into a formula, and keeping it there through a rewrite, is
easy to skip.
| What a spreadsheet formula does | What this tracker does instead |
|---|---|
| Carries whatever threshold number was typed in last, which is often the prior year's figure until someone notices it is wrong. | Applies $2,000 to payments made in 2026 or later and $600 before that, keyed to the tax year you pick — nothing to remember to update. |
| A blanket "corporation = exempt" rule marks every corporate-entity row exempt, including an attorney's own fees — the one category that is reportable regardless of entity type. | Applies the corporation exemption except for attorney fees specifically, so a firm organized as an LLC taxed as a corporation still gets flagged for its own fee payments. |
| Has no place to flag "this follows a different rule I haven't encoded" — a row either matches the formula or gets a wrong answer. | Routes attorney gross-proceeds and medical/health-care payments to "check separately" instead of guessing, because those follow their own box-specific rules this tracker has not verified closely enough to compute. |
| Tracks whether a W-9 is on file as just another column, with no ordering to say which missing one is most urgent. | Sorts a missing W-9 to the top of the review queue and marks it resolved the moment you record one received. |
A worked example, evaluated for tax year 2026. A $950 payment to an individual contractor, a $5,400 attorney's-fee payment to a firm organized as an LLC taxed as a corporation, and a $4,100 services payment to a C-corporation. A spreadsheet still running the pre-2026 $600 threshold flags the $950 contractor as needing a 1099 — wrong, since $950 is below the 2026 $2,000 threshold. A spreadsheet running a blanket "corporation = exempt" rule marks the $5,400 attorney payment exempt — wrong, since attorney fees are reportable regardless of entity type. This tracker reports the $950 contractor as below threshold, not yet reportable, and the $5,400 attorney payment as needing a 1099 with the W-9 on file. The $4,100 C-corp services payment is correctly exempt either way, because ordinary services to a corporation is not the exception.
It needs no account and no sign-in: it is a static page, the arithmetic runs in your browser, and nothing you type is ever sent anywhere.
Common questions
What does a hand-kept 1099 spreadsheet usually get wrong?
Two things, usually silently. First, its threshold formula is whatever number someone typed in last — often still $600, copied forward from a prior year, when payments made in 2026 or later use $2,000. Second, a blanket "if entity is a corporation, mark exempt" rule leaves out the one exception that does not follow entity type: an attorney's own fees for services are reportable no matter how the firm is organized. A spreadsheet formula has to encode both the threshold and the exception correctly, and re-encode the threshold again whenever it changes; this tracker applies the current rule every time.
Can you show a real example of the mismatch?
Three vendors, evaluated for 2026: a $950 payment to an individual contractor, a $5,400 attorney's-fee payment to a firm organized as an LLC taxed as a corporation, and a $4,100 payment to a C-corporation for ordinary services. A spreadsheet still using the pre-2026 $600 threshold flags the $950 contractor as needing a 1099 — wrong, since $950 is below the 2026 $2,000 threshold. A spreadsheet using a blanket "corporation = exempt" rule marks the $5,400 attorney payment exempt — wrong, since attorney fees are reportable regardless of entity type. This tracker gets both right: below threshold, not yet reportable for the first; needs a 1099, W-9 on file for the second. The $4,100 C-corp services payment is correctly exempt either way, because ordinary services to a corporation are not the exception.
Isn't a spreadsheet good enough once it's set up correctly?
It can be, for one filing season. The risk is not that a spreadsheet formula is hard to write once — it is that nothing prompts anyone to revisit it when a rule changes, the way the threshold just did. A cell holding "600" looks exactly as confident the year the real number becomes 2000 as it did the year before. This tracker has no stored formula to go stale; the threshold and the exception are applied fresh against the tax year you pick.
Does this tracker replace a spreadsheet entirely?
For deciding who needs a 1099-NEC and whose W-9 is missing, yes — that is the one job it does. It keeps no ledger of payment history, invoices, or vendor contact details beyond what you type in, and it does not e-file or generate the form itself. A bookkeeper who wants a running payment ledger across the year, not just a threshold check at filing time, still has reasons to keep a spreadsheet alongside it.
Nothing here says or implies that tracking 1099 vendors in a spreadsheet is a mistake — it is the default most small businesses already use, and it works until a rule the formula did not anticipate changes. This page describes where that shortcut breaks down, not a fault in anyone who uses it. The $950, $5,400, and $4,100 figures above are this tracker's own arithmetic on the three example vendors described in this page, not a claim about any specific business's real payments.
Open the 1099-NEC Vendor Tracker to review your own vendors.