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E-Commerce & DTC Brands: Year-End Payroll Checklist (2026)
Year-end payroll for e-commerce companies is W-2s and any 1099-NEC to employees and contractors by January 31, the fourth-quarter 941 and annual 940, and the e-commerce company items that decide which boxes are right. BEG: $45 per employee per month inside the payroll software you already use, live in 3 to 5 days.
E-commerce company items that shape the W-2 and 1099s
For tax years beginning after 2025, Form 1099-NEC must be filed for each non-employee paid at least $2,000 for services during the year, up from the prior $600 threshold. The IRS instructions state the threshold may be adjusted for inflation beginning in calendar year 2027.
Seasonal employers do not have to file Form 941 for quarters in which they paid no wages and have no tax liability. To use this treatment the employer must check the box on line 18 on every Form 941 it files.
The January calendar
W-2s and W-3 to the SSA and copies to employees by January 31; 1099-NEC for each contractor paid $2,000 or more in the year, the threshold for tax years after 2025, by the same date; Form 940 and the fourth-quarter 941 by January 31 as well, with a 10-day extension where all deposits were on time. Ten or more information returns of any kind, counted together, must be filed electronically. For e-commerce companies the reconciliation that matters is that the pay codes for seasonal workforce spikes, multi-state nexus payroll tax and contractor vs W-2 for fulfillment landed in the right W-2 boxes for every employee.
The rules behind this page, with sources
General information, not legal advice. Every rule below was read on the agency page linked next to it.
- For tax years beginning after 2025, Form 1099-NEC must be filed for each non-employee paid at least $2,000 for services during the year, up from the prior $600 threshold. The IRS instructions state the threshold may be adjusted for inflation beginning in calendar year 2027. [IRS Instructions for Forms 1099-MISC and 1099-NEC (12/2026)]
- Seasonal employers do not have to file Form 941 for quarters in which they paid no wages and have no tax liability. To use this treatment the employer must check the box on line 18 on every Form 941 it files. [IRS Instructions for Form 941 (03/2026)]
Read the full guide to how to handle year-end payroll and W-2s, and the rest of the e-commerce company payroll library.
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Frequently Asked Questions
Year-end for e-commerce companies: IRS Instructions for Forms 1099-MISC and 1099-NEC (12/2026)
For tax years beginning after 2025, Form 1099-NEC must be filed for each non-employee paid at least $2,000 for services during the year, up from the prior $600 threshold. The IRS instructions state the threshold may be adjusted for inflation beginning in calendar year 2027.
Year-end for e-commerce companies: IRS Instructions for Form 941 (03/2026)
Seasonal employers do not have to file Form 941 for quarters in which they paid no wages and have no tax liability. To use this treatment the employer must check the box on line 18 on every Form 941 it files.
When are W-2s and 1099s due for an e-commerce company?
January 31 for both, to the recipient and to the SSA or IRS. The 1099-NEC threshold is $2,000 for tax years after 2025, and 10 or more information returns of any type must be e-filed.
What does managed payroll cost for an e-commerce company?
$45 per employee per month, all-inclusive, inside the payroll software you already use, with no monthly minimum. Seasonal workforce spikes, multi-state nexus payroll tax and contractor vs W-2 for fulfillment are configured at setup, not billed as add-ons.
Related Resources
Anthony leads payroll solutions at Business Executive Group, a national managed payroll firm serving businesses across industries including E-Commerce & DTC Brands. BEG manages payroll at $45 PEPM, all-inclusive, with deep expertise in compliance, multi-state filing, and industry-specific payroll requirements. Get instant pricing at beghr.com.
Authoritative source: IRS: Understanding Employment Taxes
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