New Reporting Requirements for 1099-K
If you are a business owner that accepts third-party transactions, someone using an online marketplace, or someone who frequently receives money on a payment app such as Venmo or Paypal, there are new reporting thresholds. If you received more than $5,000 in payments through third-party networks, you will now get a 1099-K to use when reporting income on your return. This form reports credit card payments and transactions made from these apps, platforms, and card processors.
*Note: Payments you received from family and friends should not be reported on a 1099-K. If paying personal expenses through these apps, make sure to list these as non-business payments in the description.
Qualified third-party platforms include but are not limited to:
- Venmo
- PayPal
- Cash App
- Etsy
- Poshmark
- eBay
- Uber
- Lift
- Square
- Stripe
Click here to read more about filing a 1099-K.
Changes to These Reporting Requirements in The Future
The $5,000 threshold will only remain for 2024. Over the next few years, these reporting requirements will change as follows:
• 2024: Over $5,000 in payments and one or more transactions
• 2025: Over $2,500 in payments and one or more transactions
• 2026 and after: Over $600 in payments and one or more transactions
When and where will I receive my 1099-K?
You will receive your 1099-K from the designated platform by January 31st if applicable. Depending on the platform, this might be electronic or mailed to you. For example, if receiving a 1099-K from Venmo, you can access this form by logging into your account, going to your Settings page, and clicking on the “Tax Documents” option. If you meet the threshold for filing a 1099-K, this will be located here. Many of these websites should have a tax information page readily available to you in your account.
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Blog by Kim Storen, EA – Senior Tax Accountant
Learn more about Kim and the rest of the Storen Financial team here.