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Form 1099-PATR is a return that cooperatives use to report taxable distributions and certain pass-through items paid or allocated to patrons.
A patron is any person or business that does business with the cooperative and shares in its earnings.
The form reports several types of payments and pass-through items, including:
A cooperative must file Form 1099-PATR for each patron if one of these situations applies:
This filing duty applies broadly to corporations making reportable patronage distributions. Farmers' cooperatives exempt under Section 521 may also have reporting requirements for certain nonpatronage distributions.
Note: There are certain organizations that are excluded from filing Form 1099-PATR, such as mutual savings banks, insurance companies, and rural electric or telephone cooperatives that serve rural areas.
Form 1099-PATR reports specific type of distributions a cooperative passes through to its patrons, including:
Cooperatives generally do not need to file Form 1099-PATR for payments made to:
If a cooperative withheld federal income tax under the backup withholding rules, the exemption does not apply, even if the payment amount is below the reporting threshold.
Consumer cooperative exemption
A consumer cooperative that mainly sells goods or services for personal or family use can skip filing altogether. However, this exemption is not automatic. The cooperative must first file Form 3491 to get approval.
Form 1099-PATR has 13 boxes, each reporting a specific type of payment, deduction, or credit passed through to a patron.
Box 1 covers patronage dividends the cooperative pays to the patron during the year. These payments may be made in cash, as qualified written notices of allocation at face value, or other qualifying property.
Box 2 applies only to farmers' cooperatives exempt from tax under Section 521. This box is used for reporting nonpatronage earnings or income the cooperative earned from outside sources. Redemptions of non-qualified notices associated with nonpatronage distributions are also reported here.
Box 3 reports per-unit retain allocations. These are payments made in cash, qualified certificates, or other property that a marketing cooperative sets aside for a patron based on the amount of product marketed for them.
Box 4 reports federal income tax withheld from patronage payments under backup withholding rules. This usually happens when a patron's Taxpayer Identification Number (TIN) is missing or incorrect.
It reports payments made when a cooperative pays out certain non-qualified allocations that were issued to a patron in an earlier year. The amount is taxed only when redeemed by the cooperative.
Boxes 6 and 7 apply to specified agricultural or horticultural cooperatives, co-ops that grow, process, or market farm products. Box 6 reports the patron's share of the Section 199A(g) deduction. While Box 7 reports payments from the cooperative to the patron that the cooperative used to calculate its Section 199A(g) deduction. The cooperative must report these payments even if it does not pass through any Section 199A(g) deduction.
Boxes 8 and 9 report business income already included in Boxes 1, 2, 3, or 5. Box 8 reports income from businesses that are not specified as an SSTB, and Box 9 reports income from an SSTB.
Box 10 reports the patron's share of the cooperative's investment credit. Box 11 reports the patron's share of the work opportunity credit. And Box 12 lists any other credit or deduction passed through, such as the small employer health insurance premium credit.
Box 13 is a checkbox that applies only to specified agricultural or horticultural cooperatives.
The IRS has not issued any major changes to Form 1099-PATR for the 2026 tax year. Cooperatives should continue using the current form and instructions until a new revision is issued.
Filing Form 1099-PATR correctly starts with collecting details about the cooperative, the patron, and the distributions paid during the year.
For the cooperative, the return needs:When a distribution includes Section 199A information, it is also reported on Form 1099-PATR. This includes the Section 199A(g) deduction, qualified payments, qualified business income items, specified service trade or business items, and any required supplemental statement. Credits such as the investment credit or work opportunity credit follow the same rule and are also reported on this form.
| Filing Type | Due Date |
|---|---|
| Recipient Copy | February 1, 2027* |
| IRS Paper Filing | March 1, 2027* |
| IRS Electronic Filing | March 31, 2027 |
*When a due date falls on a weekend or legal holiday, the deadline moves to the next business day.
1099Online helps cooperatives prepare and electronically file Form 1099-PATR.
Start by entering the cooperative's name, TIN, address, and contact details. Then add the patron's legal name, TIN, address, and account number if needed. Cooperatives with many patrons can use 1099Online's bulk upload feature to add multiple records at once.
Enter patronage dividends, nonpatronage distributions, and per-unit retain allocations. Include any redeemed nonqualified notices and federal income tax withheld.
Use 1099Online's guided, step-by-step process to add Section 199A information and investment or work opportunity credits..
Cooperatives can review names, distribution amounts, and box entries before the return is submitted. Run a TIN match using 1099Online's real-time TIN match to flag any mismatches before submission.
The cooperative must sends the patron's copy by the applicable deadline. 1099Online supports this step with USPS print-and-mail delivery, email delivery, or downloadable PDF copies.
Cooperatives use Form 1099-PATR to report patronage dividends and other taxable distributions paid to patrons, as well as certain deductions and credits the cooperative passes through to patrons.
A cooperative must file Form 1099-PATR for each patron who received $10 or more in patronage dividends and other distributions described in Section 6044(b). A cooperative must also file when it withheld federal income tax from a patron under backup withholding rules.
Yes, the filing threshold for Form 1099-PATR is $10 in patronage dividends and other distributions described in Section 6044(b).
Yes, backup withholding always requires filing, regardless of how small the payment amount is.
A qualifying consumer cooperative may apply for an exemption using Form 3491. But the IRS must approve the request before the exemption applies.
Payments to corporations are generally exempt from Form 1099-PATR reporting. This exemption does not apply if backup withholding applies.
The recipient copy for Form 1099-PATR for the 2026 tax year is due February 1, 2027. The usual January 31 deadline does not apply because that date falls on a Sunday.
Late or incorrect Form 1099-PATR filings can lead to IRS penalties, starting from $60 per form if filed up to 30 days late, $130 if filed 31 days through August 1, $340 if filed after August 1 or not filed at all, and $680 for intentional disregard. A separate penalty under Section 6722 can apply when the recipient copy is filed late.
Filers should watch for a few common mistakes on Form 1099-PATR, such as entering the wrong patron TIN or selecting the wrong box.
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