1099 filers who are required to file 250 or more 1099 forms must file electronically, either through a 1099 E-File service or through 1099 software with upload capabilities to the IRS FIRE System.

Using  1099 E-File service is more convenient since the user does not have to register with the IRS to obtain a password (called TCC code) , but this method is more expensive. On the other hand, using 1099 software that can generate file that comply with IRS e-File regulations is more cost effective, but needs more knowledge on the user’s side and the filer has to obtain a TCC (transmitter control code) from the IRS in order to submit the 1099 returns.

Different business types are required to file 1099 forms (both by paper and electronically), some examples include: agricultural businesses / farming, marketing/advertising, non-profit organizations, online businesses, building / construction, repair / maintenance, schools , finance / insurance, hotels/motels(casinos) and many more.

Please remember that there is a $100 penalty per form imposed on business filers for failure to send 1099 returns to recipients by the end January each year. The penalty is reduced to $30, if the payer sends the form within 30 days of the deadline.

The following states also require employers to file 1099s with them (either directly or through the IRS CFSFS): Alabama, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Georgia, Hawaii, Idaho, Indiana, Kansas, Kentucky, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Jersey, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, Utah, Vermont, Virginia, West Virginia and Wisconsin


Some useful resources for filing forms 1099 electronically:

IRS FIRE System: https://fire.irs.gov/
IRS Publication 1220: http://www.irs.gov/pub/irs-pdf/p1220.pdf
IRS 1099 E-File FAQ: http://1.usa.gov/14nHOGF
1099 E-File Layout: http://1099-efile.realtaxtools.com/format/

Please refer to the video below for more information on how to file forms 1099 electronically: