What Does Nonemployee Compensation Mean in 2026? IRS Rules, 1099-NEC Thresholds, and Worker Classification
Quick Answer What Does Nonemployee Compensation Mean? Nonemployee compensation means payment for services rendered by someone who is not your employee. The IRS defines it as compensation paid to independent contractors, freelancers, consultants, and other self-employed individuals who provide services to a business but are not on the payroll . You pay nonemployee compensation to…