How Does the Combined Federal/State Filing (CF/SF) Program Work?

The Combined Federal/State Filing (CF/SF) Program is an IRS electronic filing program that allows businesses to submit eligible tax information returns, such as certain 1099 forms, to the IRS once, after which the IRS forwards those filings to participating state tax agencies.

For companies managing large-scale payouts or reporting obligations across multiple jurisdictions, the CF/SF Program helps reduce filing work and simplifies parts of the state reporting process. Instead of submitting the same information separately to every participating state, businesses can use a centralized federal filing workflow for qualifying returns.

*It’s important to note that this program does not eliminate all state filing obligations. Participation varies by state, not every form type is covered, and some jurisdictions still require direct reporting or additional submissions even when the CF/SF Program is utilized.

We’ll walk you through what you need to know about the CF/SF Program, which states are participants, and how to take advantage of it.

Overview of the CF/SF Program

The Combined Federal/State Filing Program was designed to simplify multi-state tax information return reporting. When businesses electronically submit eligible returns to the IRS, the IRS acts as a forwarding agent and sends those filings to participating states on the filer’s behalf.

The program only applies to electronic filing workflows and is intended to reduce administrative overhead for organizations filing across multiple jurisdictions. It is particularly useful for digital marketplaces, creator platforms, gig economy companies, and other businesses that issue large volumes of 1099 forms to contractors, sellers, creators, and service providers.

It’s important to note that the IRS is in the process of modernizing its electronic filing infrastructure. Historically, information returns were submitted through the FIRE system, but the agency is transitioning toward newer filing workflows through IRIS, the Information Returns Intake System. Tax year 2026 (filing season 2027) is the IRS’s targeted timeline for retiring the FIRE system. Because IRS filing requirements continue to evolve, businesses should avoid relying on outdated filing procedures and confirm current submission requirements each tax year.

A Transmitter Control Code (TCC) is an IRS-issued identifier used to submit information returns electronically. Businesses will need to get a new TCC as IRS electronic filing workflows make the final shift from FIRE toward IRIS in 2026.

Participating states

For the 2025 tax year, the following states participate in the IRS CF/SF program: 

Alabama, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, District of Columbia, Georgia, Hawaii, Idaho, Indiana, Kansas, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Montana, Nebraska, New Jersey, New Mexico, North Carolina, North Dakota, Ohio, Oklahoma, Pennsylvania, Rhode Island, South Carolina, and Wisconsin. 

Businesses should verify participation annually because states can change their reporting requirements, supported forms, and direct filing rules from year to year. The most up-to-date information can be found in the IRS’s Publication 1220 for the current tax year and on the separate state tax agency websites. 

Eligible forms and filing requirements

Not every tax information return qualifies for the CF/SF Program, and state participation can vary depending on a variety of factors such as the form type, filing year, and whether state tax withholding was taken. The IRS lists the Combined Federal/State Filing Program requirements in Publication 1220, which is updated for each filing year, so businesses should verify current eligibility before filing rather than relying on last year’s form list.

The program can apply to several common information returns, including Forms 1099-MISC, 1099-NEC, and 1099-K. These three forms are especially important for platforms, marketplaces, and other companies managing high-volume payouts to contractors, sellers, creators, or other non-employee recipients.

Form 1099-MISC

Form 1099-MISC is generally used for miscellaneous payments made in the course of a trade or business, including rents, prizes and awards, royalties, certain legal payments, and other reportable payments. Unlike other Form 1099-MISC payments, which are subject to a $600 reporting threshold, the IRS requires businesses to report royalty payments exceeding $10 in a tax year using Form 1099-MISC. For federal filing, Form 1099-MISC is due to recipients by January 31 and to the IRS by March 31 when filed electronically.

Form 1099-NEC

Form 1099-NEC is used to report nonemployee compensation. For many businesses, this is the most operationally important 1099 form because it applies to payments for services made to independent contractors and other non-employees. Form 1099-NEC is due to the IRS and recipients by January 31, which gives tax teams less time to validate data, resolve TIN issues, and manage state filing requirements.

Form 1099-K

Form 1099-K is used by payment settlement entities to report payment card transactions and third-party network transactions. Payment card transactions do not have the same federal de minimis threshold as third-party network transactions. For third-party settlement organizations, the federal reporting threshold is more than $20,000 in gross payments and more than 200 transactions, although state thresholds may be lower. Form 1099-K is due to recipients by January 31 and to the IRS by March 31 when filed electronically. 

How the CF/SF Program works

The CF/SF filing process is relatively straightforward from an operational perspective. Businesses prepare eligible tax information returns, validate filing requirements, and electronically submit the returns to the IRS. Once accepted, the IRS acts as a forwarding agent and makes qualifying records available to participating state agencies.

However, the IRS forwarding process does not remove the need for ongoing state compliance management. Businesses are still responsible for confirming:

• whether a state participates in CF/SF
• which forms the state accepts
• whether direct filing is still required
• applicable filing deadlines
• correction and amendment procedures

Corrected returns may also be forwarded through the program, although state-level handling can differ by jurisdiction. The IRS also notes that some participating states require a separate notification that the issuer is filing through CF/SF, so the federal submission should not be treated as a complete substitute for checking state rules.

As the IRS continues modernizing electronic filing infrastructure through IRIS and related systems, businesses should expect filing workflows and technical requirements to continue evolving over time.

Benefits of using the CF/SF Program

Managing information return reporting across multiple states can be challenging, particularly when filing requirements vary by form type, withholding status, and jurisdiction. The CF/SF Program can reduce some of this operational complexity by: 

• Reducing duplicate submissions for eligible forms and participating states
• Minimizing manual filing effort when state reporting requirements can be satisfied through the CF/SF Program
• Centralizing portions of the information return reporting workflow
• Increasing efficiency for businesses filing large volumes of information returns

For finance and operations teams trying to scale tax reporting efficiently, the program can play an important role in broader tax compliance automation strategies.

Limitations and important considerations

While the CF/SF Program can simplify electronic filing workflows, it does not replace all state-level reporting obligations.

One of the most common compliance mistakes is assuming that filing a federal tax return automatically satisfies every state reporting obligation. In practice, businesses still need to monitor state-specific requirements carefully each filing season.

Not all states participate in the program, and participation rules can change over time. Even among participating states, some jurisdictions still require direct filing for specific forms, impose earlier deadlines, or maintain additional reporting requirements outside the federal workflow.

State tax withholding is one common reason a business may still need to file directly with a state. Many states require direct reporting when state income tax was withheld, even if the state otherwise participates in the CF/SF Program. 

Lower state filing thresholds, such as with Form 1099-K, are another common reason a business may still need to file directly with a state.

Forms 1099-MISC, 1099-NEC, and 1099-K can each create different state reporting challenges. Form 1099-NEC has an earlier January 31 federal deadline, which gives tax teams less time to validate data and manage state filing requirements. Form 1099-K creates additional complexity because some states apply lower reporting thresholds than the federal standard. State filing requirements for Form 1099-MISC can also vary depending on the type of payment being reported, whether state income tax was withheld, and the rules established by each state.

Because IRS systems, state participation, and electronic filing standards continue to evolve, organizations should review the latest IRS guidance, Publication 1220 updates, IRIS requirements, and state tax agency resources annually.

Best practices for CF/SF participation

Organizations managing large-scale information return reporting should treat CF/SF participation as part of a broader compliance operations strategy rather than a one-time filing setup.

Strong filing workflows typically begin with maintaining accurate payee data and validating jurisdiction-specific requirements before filing season begins. Businesses should also regularly review state participation updates, monitor IRS filing system changes, and maintain visibility into varying filing deadlines across jurisdictions.

Pre-submission validation is equally important. Small formatting issues, incomplete taxpayer information, or incorrect filing assumptions can create downstream correction work that becomes difficult to manage at scale.

For companies operating across many jurisdictions, centralized compliance workflows and automation tools can help reduce manual coordination and improve filing consistency year over year.

How automation software simplifies CF/SF compliance

As tax reporting requirements become more fragmented, many businesses are moving away from manual filing workflows and adopting automation platforms to manage compliance operations more efficiently.

Managing state participation rules, filing deadlines, corrections, taxpayer validation, and evolving IRS filing systems manually can become difficult at scale, particularly for businesses processing large payout volumes.

Automation software can help centralize these workflows by:

• validating payee tax information
• generating compliant electronic filing formats
• tracking jurisdiction-specific obligations
• managing corrections and amendments
• maintaining audit-ready reporting records

Trolley helps businesses streamline payout operations and tax reporting through a unified infrastructure for payee onboarding, tax form collection, information return reporting, and compliance automation. 

Trolley supports filing through the IRS Combined Federal/State Filing (CF/SF) Program for eligible information returns, helping businesses centralize portions of their federal and participating state reporting workflows.

For finance and tax operations teams, that means less manual coordination, greater filing visibility, and a more scalable approach to managing combined federal and state reporting requirements as IRS and state filing systems continue to evolve.

Frequently asked questions

What is the Combined Federal/State Filing (CF/SF) Program?

The Combined Federal/State Filing (CF/SF) Program is an IRS electronic filing program that forwards eligible tax information returns from the IRS to participating state tax agencies.

Which 1099 forms qualify for the CF/SF Program?

The CF/SF Program can apply to several 1099 forms, including Forms 1099-MISC, 1099-NEC, 1099-K, 1099-B, 1099-DIV, 1099-G, 1099-INT, 1099-OID, 1099-PATR, and 1099-R, but eligibility depends on current IRS guidance and state participation.

Does every state participate in the CF/SF Program?

No. Some states do not participate in the CF/SF Program, while others participate but still require direct filing for certain forms, tax withholding situations, or state-specific reporting obligations.

Does filing through the CF/SF Program satisfy state filing requirements?

Filing through the CF/SF Program does not always satisfy state filing requirements. Some states still require direct filing, additional reporting, separate notification, or have earlier filing deadlines.

Is Form 1099-NEC included in the CF/SF Program?

Form 1099-NEC can be included in CF/SF workflows, but many states still require direct filing for Form 1099-NEC depending on the jurisdiction, withholding status, and filing year.

Why is Form 1099-NEC challenging for state filing?

Form 1099-NEC is challenging because it is generally due by January 31 (well before others) and often applies to high-volume contractor payments. Some states also require direct 1099-NEC reporting even when they participate in CF/SF for other forms.

Is the IRS replacing the FIRE system with IRIS?

The IRS has announced that for tax year 2026, filing season 2027, IRIS will be the only intake system available for filing tax information returns. 

What happens if a state does not participate in CF/SF?

Businesses must submit information returns directly to non-participating states according to those states’ filing requirements.

What software helps automate combined federal and state filing?

Tax automation platforms like Trolley help businesses manage electronic filing workflows, state reporting obligations, corrections handling, and payee tax compliance at scale.