State 1099 filing requirements are the part of contractor compliance that finance teams ignore until they get the first state notice. The federal 1099 rules are well-documented and broadly consistent. State 1099 rules vary by state, change year to year, and sometimes contradict the federal rules.
This guide is a working reference for US finance and operations teams handling 1099 filings across multiple states. We walk through the Combined Federal/State Filing Program, the states that participate, the states that require direct filing, the impact of the One Big Beautiful Bill Act $2,000 threshold change on state thresholds, the no-income-tax states with no filing obligation, and per-state details for the highest-volume states.
All claims are sourced from the IRS Combined Federal/State Filing Program page, IRS Publication 1220, the text of the One Big Beautiful Bill Act, the California FTB, Pennsylvania DOR, Massachusetts DOR, Oregon DOR, Illinois DOR, and other state DOR pages cited below.
How State 1099 Filing Works Mechanically
A US company filing 1099s has a federal filing obligation with the IRS and, separately, a state filing obligation with the state where each contractor lives (or where the payment was sourced). The federal filing is uniform. The state filings are not.
There are three patterns at the state level:
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CF/SF state. The state participates in the Combined Federal/State Filing Program. The IRS forwards the 1099 data to the state automatically. The company files only with the IRS and the federal filing satisfies the state obligation (for the forms covered by CF/SF).
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Direct-filing state. The state does not participate in CF/SF, or participates but excludes certain forms or scenarios. The company must file 1099 information separately with the state DOR.
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No-filing state. The state has no income tax or has no 1099 filing requirement. The company files only with the IRS and no state filing is needed.
A single company paying contractors in 20 states typically faces a mix of all three patterns. The federal filing is one return. The state filings can be zero, one, or twenty depending on where the contractors live.
The Combined Federal/State Filing Program
The CF/SF program was created in the 1980s to reduce duplicate filings between the IRS and state tax authorities. Under the program, the IRS receives information returns from filers, processes them, and then forwards relevant data to participating states based on the recipient’s address.
The mechanics from the IRS CF/SF page: the IRS runs the CF/SF process nine times a year, distributing files to participating states. States receive the data through secure servers. A state designates a representative who retrieves the state-specific data on the state’s schedule.
For the program to work, the filer must:
- File electronically (paper filings are not eligible for CF/SF)
- Indicate participation in CF/SF on the electronic submission
- Use the correct state code from Publication 1220
If the filer skips the CF/SF indicator on the electronic file, the IRS does not forward the data and the state filing obligation is unmet.
Which States Participate in CF/SF
The participating state list is maintained in IRS Publication 1220. The list changes from year to year as states join or leave the program.
As of 2026, the participating states include (this list reflects publicly available coverage and should be verified against the current Publication 1220 before filing):
Alabama, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, District of Columbia, Georgia, Hawaii, Idaho, Indiana, Kansas, Louisiana, Maine, Maryland, Massachusetts (limited forms only), Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Jersey, New Mexico, North Carolina, North Dakota, Ohio, Oklahoma, Pennsylvania (limited), South Carolina, Wisconsin.
Forms typically included in CF/SF: 1099-B, 1099-DIV, 1099-G, 1099-INT, 1099-K, 1099-MISC, 1099-NEC, 1099-OID, 1099-PATR, 1099-R, and Form 5498.
The key caveat is that even for participating states, the state may still require direct filing in specific scenarios. The next section walks through the common direct-filing exceptions.
States That Require Direct 1099 Filing
Several states require direct state filing in addition to (or instead of) federal CF/SF.
Massachusetts
The Massachusetts DOR 1099 filing requirements page confirms that 1099-NEC must be filed directly with Massachusetts DOR. The IRS does not forward 1099-NEC forms to Massachusetts through CF/SF.
Key Massachusetts facts for 2026:
- Direct filing through MassTaxConnect required for 1099-NEC
- Electronic filing mandatory for any filer submitting 50 or more 1099 series forms
- Massachusetts retains its own $600 threshold for 1099-MISC reporting regardless of the federal $2,000 OBBBA threshold
- 1099-NEC deadline: January 31
Pennsylvania
The Pennsylvania DOR 1099-NEC income records page sets out the state filing requirement.
Key Pennsylvania facts for 2026:
- 1099-MISC and 1099-NEC with Pennsylvania withholding must be filed directly through myPATH
- Electronic filing mandatory for filers submitting 10 or more 1099s
- Annual reconciliation REV-1667 due January 31
- Pennsylvania Withholding ID (8 digits) required for filing
- Even businesses without employees need a PA Withholding ID to file 1099s
Oregon
The Oregon iWire page sets the Oregon-specific 1099 filing process.
Key Oregon facts for 2026:
- All 1099s must be filed electronically through iWire
- 1099-NEC and W-2 deadline: January 31
- 1099-MISC, 1099-R, 1099-G, 1099-K, W-2G deadline: March 31
- Beginning January 2026, iWire requires login to Revenue Online for manually typed and DOR iWire spreadsheet submissions
- Penalties up to $25,000 for non-compliance
Illinois
The Illinois DOR Publication 110 sets out Illinois requirements.
Key Illinois facts for 2026:
- Form 1099-NEC filings due by January 31
- Other 1099 forms due by March 31
- Forms W-2G and 1099-K must be filed electronically through the Illinois FIRE Electronic Transmission Program
- Most non-1099-K 1099s are not required to be submitted to Illinois unless specifically requested
- Payers issuing 1099s reporting Illinois income tax withheld may file voluntarily through Illinois FIRE or MyTax Illinois
New York
The New York State Department of Taxation and Finance does not require separate state filing of federal 1099 forms in most cases.
Key New York facts for 2026:
- New York does not participate in CF/SF
- New York does not require separate state filing of 1099-NEC, 1099-MISC, 1099-INT, 1099-DIV, 1099-R, or 1099-C
- Payee-level withholding information collected through quarterly Form NYS-45
- Federal 1099 filing with the IRS satisfies the state obligation by default
The implication: a US company paying New York contractors files 1099s with the IRS only. No separate filing with NY DTF is required for the standard 1099 types.
How OBBBA Affects State Thresholds
The One Big Beautiful Bill Act raised the federal 1099-NEC and 1099-MISC threshold from $600 to $2,000 for payments made in calendar year 2026 and later. It did not change state thresholds automatically.
Each state sets its own 1099 reporting threshold under state law. Some states automatically conform to the federal threshold. Others have their own threshold that remains at $600 regardless of the federal change.
Examples of how this plays out:
California. The Franchise Tax Board generally follows the federal threshold, which means the California threshold for 1099-NEC moves from $600 to $2,000 for 2026 payments along with the federal change. The $600 threshold still applies to specific scenarios such as payments to app-based drivers.
Massachusetts. The MA DOR retains a $600 threshold for 1099-MISC reporting regardless of the federal $2,000 OBBBA threshold. A company paying a Massachusetts contractor $1,500 in 2026 has no federal 1099-NEC obligation but may still have a state 1099 obligation in Massachusetts depending on the type of payment.
Pennsylvania. The PA threshold for 1099-MISC and 1099-NEC tracks the federal rules but Pennsylvania has separate state nonresident withholding rules that operate independently of the 1099 threshold.
New Jersey. NJ conforms to federal thresholds for most purposes but has separate state withholding requirements for certain contractor scenarios.
The general rule for 2026: do not assume a state follows the new $2,000 federal threshold without checking the state’s DOR site. Many states retain $600.
The No-Income-Tax States
Nine states have no personal income tax and generally no 1099 filing requirement:
- Alaska
- Florida
- Nevada
- New Hampshire (previously taxed interest and dividends only, has phased out)
- South Dakota
- Tennessee (previously taxed interest and dividends only, has phased out)
- Texas
- Washington (has narrow capital gains tax but no general income tax, no 1099 filing requirement)
- Wyoming
For contractors residing in these states, the federal 1099 filing satisfies the entire obligation. No state filing is needed.
State-by-State Reference
The following grouping is a starting point. Always verify against the state’s current DOR guidance before filing.
States with no income tax (no 1099 filing). Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, Wyoming.
Standard CF/SF participating states (federal CF/SF filing generally sufficient). Alabama (AL DOR), Arizona (AZ DOR), Arkansas (AR DFA), Colorado (CO DOR), Connecticut (CT DRS), Delaware (DE DOR), District of Columbia (DC OTR), Georgia (GA DOR), Hawaii (HI DOTAX), Idaho (ID Tax Commission), Indiana (IN DOR), Iowa (IA DOR), Kansas (KS DOR), Louisiana (LA DOR), Maine (ME Revenue Services), Maryland (MD Comptroller), Michigan (MI Treasury), Minnesota (MN DOR), Mississippi (MS DOR), Missouri (MO DOR), Montana (MT DOR), Nebraska (NE DOR), New Jersey (NJ Taxation), New Mexico (NM TRD), North Carolina (NC DOR), North Dakota (ND OST), Ohio (OH DOT), Oklahoma (OK Tax Commission), South Carolina (SC DOR), Vermont (VT DOT), Wisconsin (WI DOR).
States with direct-filing requirements (verify forms and scenarios). California (CA FTB) accepts most 1099s through CF/SF but requires direct filing for nonresident withholding scenarios (7% above $1,500). Illinois (IL DOR) requires direct filing for 1099-K through Illinois FIRE. Kentucky (KY DOR) requires direct filing for 1099s with KY withholding. Massachusetts (MA DOR) requires direct MassTaxConnect filing for 1099-NEC and retains a $600 state threshold for 1099-MISC. Oregon (OR DOR) requires direct iWire filing for all 1099s. Pennsylvania (PA DOR) requires direct myPATH filing for 1099s with PA withholding and a REV-1667 reconciliation due January 31. Rhode Island (RI Division of Taxation), Utah (UT State Tax Commission), Virginia (VA TAX), and West Virginia (WV State Tax Department) require direct filing for state-withholding 1099s.
New York (NY DTF) does not participate in CF/SF but does not require separate state filing for most 1099 forms. Withholding is reported through quarterly Form NYS-45.
Operational Pattern for Multi-State 1099 Filings
For a US company paying contractors across many states, the clean operational pattern is:
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At each contractor onboarding. Collect Form W-9 with state of residence. Determine which state’s 1099 rules apply.
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At each payment. Track the gross amount, the recipient state, and any state-level withholding required.
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At year-end aggregation. Group payments by state. Determine which states require direct filing, which are covered by CF/SF, and which require no filing.
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At federal filing. File 1099-NEC and other 1099s electronically with the IRS, indicating CF/SF participation for the recipient state if the state is in the CF/SF program.
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At state filing. For each direct-filing state, file with the state DOR through the state’s portal (MassTaxConnect, myPATH, iWire, etc.) by the state’s deadline.
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At reconciliation. Confirm acknowledgments from both federal and state systems. Resolve any rejections promptly.
A modern contract management platform handles US-person and foreign-person contractors with the right form per contractor at onboarding, the right federal information return at year-end, and the right state filings based on each contractor’s state of residence. The federal-vs-state split is opaque to the user and the deadlines are tracked automatically.
Common Mistakes
After working with US finance teams on state 1099 compliance, these are the patterns we see most often.
Assuming CF/SF covers everything. The team files federally with CF/SF participation enabled and assumes all state filings are done. In reality, Massachusetts, Pennsylvania, Oregon, and several other states still require direct state filing for specific scenarios. The first state notice arrives in April or May.
Using the new federal $2,000 threshold for state filings. The federal threshold rose to $2,000 for 2026 under OBBBA, but many states retain $600. Filing only federal-threshold-eligible 1099s with a $600-threshold state creates a compliance gap.
Missing direct-filing deadlines. Pennsylvania’s myPATH deadline for 1099-NEC is January 31. Oregon’s iWire deadline for 1099-NEC is January 31. Massachusetts is January 31. A team that waits for the March federal deadline misses the January state deadlines and pays penalties.
Not tracking state of residence. The team files 1099 with the federal IRS based on the federal W-9 information but does not track which state each contractor lives in. When the state filing question comes up, the team has to re-source the data.
Treating all CF/SF states identically. Even within the CF/SF program, states have different rules about which forms they accept through CF/SF vs which require direct filing. Massachusetts technically participates but excludes 1099-NEC. Pennsylvania participates but requires direct myPATH filing for withheld amounts.
The Bottom Line
State 1099 filing in 2026 is a per-state determination. The Combined Federal/State Filing Program covers many states for many forms, but it does not cover everything. Massachusetts, Pennsylvania, Oregon, and several other states require direct state filing for at least some 1099 scenarios. New York requires no separate state filing but does not participate in CF/SF either.
The OBBBA $2,000 federal threshold does not flow automatically to state thresholds. Many states retain $600 under state law. The right way to handle this is to track each contractor’s state of residence at onboarding, apply the state’s specific rules at year-end, and file with each state’s DOR through the state’s portal on the state’s deadline.
If your company is paying contractors across multiple states and wants the W-9, federal 1099, and per-state filing workflow handled as a single platform, take a look at our Contract Management product. The pricing page covers the per-contract cost.