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W-2 forms are tax forms given to an employee from employers at the end of the year. It contains important information such as the name of the employee, how much money they made during the year, and various taxes that were withheld from their pay. A W-2 also includes the name of the business and the EIN number. Employees need a W-2 at the end of the year so that they may file their taxes.
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1099-MISC forms are tax forms used to report miscellaneous payments that a company made for the reporting tax year. Examples of income reported on a 1099-MISC include royalty payments, monies gained from rent, prizes, monetary awards, and substitute payments a person receives instead of dividends.
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1099-NEC forms are tax forms used by employers to report payments that they make to independent contractors and freelancers. Contractors need 1099-NEC forms so that they can accurately report their income and pay any taxes due by April 15th of each year. The 1099-NEC form is specifically for independent contractors; for regular employees, use form W-2.
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