The IRS has once again hit the pause button on the new $600 1099-K Form reporting requirements. In this video, we’re discussing what this pause means for you, what the IRS has in store for 2024 and beyond, and what to do if you receive a 1099-k form.

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This rule change was approved as part of the American Rescue Plan in March 2021 and would have required payment platforms like Venmo, PayPal, Etsy, and Airbnb to send Form 1099-K to both the IRS and users if their transactions exceeded $600 total in a year.

After considering feedback from taxpayers, tax professionals, and payment processors, the IRS decided to delay the much-debated $600 reporting threshold requirement for third-party payment organizations.

So for the 2023 tax year, payment apps and online marketplaces will only be required to send out Form 1099-K if you receive over $20,000 and have more than 200 transactions.

The IRS plans to implement a phased-in approach with a new threshold of $5,000 starting in 2024. This means if you sell goods or provide services and your earnings from third party payment apps or online marketplaces cross that $5,000 mark, you'll be getting a 1099-K tax form in early 2025 for your 2024 taxes.

For the 2025 tax year, the threshold would step down to $600, unless the IRS makes additional changes. And then there’s Congress – they are currently pushing for a $10k threshold.

Just remember, reporting thresholds aside, all income is taxable, and the IRS expects you to play by the rules.

#1099k #1099-k #irsrules #taxes2023 #taxes2024

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