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You can classify a payment as a reimbursement so it’s excluded from 1099-NEC totals and tax-collection thresholds. Use this when you’re paying someone back for expenses they incurred on your behalf rather than paying them for services.

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What counts as a reimbursement

A reimbursement is a payment that repays a recipient for out-of-pocket costs — for example, travel expenses, supplies, or other business expenses they paid for on your behalf. Because reimbursements aren’t taxable income to the recipient, they shouldn’t be reported on a 1099-NEC. You’re responsible for deciding whether a payment qualifies as a reimbursement. If you’re unsure, consult your tax advisor.

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How reimbursements affect 1099-NEC totals

When a payment is marked as a reimbursement:
  • It displays a Reimbursement pill on the payment row.
  • Its amount is excluded from the recipient’s 1099-NEC aggregation.
  • Its amount is excluded from tax-collection thresholds that trigger W-9 or W-8 requests.
  • It’s flagged in payment exports with a Reimbursement column set to Yes.
Non-reimbursement payments continue to count toward 1099-NEC totals as usual.

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Marking an individual payment when you send it

When you create a single payment, you can mark it as a reimbursement before submitting:
  1. Go to Payments and select Send payments.
  2. Choose the recipient and enter the amount, description, and payment date.
  3. Check Mark as reimbursement.
  4. Review and submit the payment.
The same checkbox is available when recording an off-platform payment in the external payment flow.

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Marking payments in a bulk CSV upload

The bulk payment CSV template includes an is_reimbursement column. Set the value to 1, true, yes, or y to mark that row as a reimbursement. Leave it blank or set it to 0, false, or no for a regular payment. The column header reimbursement is also accepted. Example CSV: 
email,description,amount (dollars),is_reimbursement,firstname (optional),lastname (optional)
alex@example.com,Contract work for May,1500,,Alex,Rivera
sam@example.com,Travel expense reimbursement,420.50,true,Sam,Lee
Rows marked as reimbursements display the Reimbursement pill in the review grid so you can confirm before submitting the batch.

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Marking or unmarking an existing payment

You can change a payment’s reimbursement status after it’s been sent:
  1. Open the Payments dashboard and find the payment row.
  2. Click the row’s overflow menu (the ⋯ icon).
  3. Select Mark as reimbursement or Unmark as reimbursement.
You can also toggle the status from the payment detail view by clicking Mark or Remove next to the Reimbursement field. Updating the status immediately recalculates the recipient’s 1099-NEC totals and tax-collection thresholds for the year. If you change the status after a 1099-NEC has already been generated, review the updated form in Tax forms to confirm the change is reflected.

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Reimbursements in payment exports

When you export payments to CSV, each row includes a Reimbursement column with the value Yes or No. Use this column to reconcile reimbursements against your accounting records.