IRS Form 1099-K gets a lot of attention each tax season. That’s in part because the 1099-K form is used to report certain payments from payment cards and third-party network transactions. And millions of people use third-party networks each year (think Venmo, PayPal, Cash App, Stripe, etc.) for both business and personal transactions.
But the 1099-K has received attention even before the current tax season started because of a new $600 reporting threshold for the form that is expected to apply for 2023. So, it’s important to know what the 1099-K form is and what to do when you do (or don’t) receive one.
What a 1099-K Form is Used For
An IRS 1099-K form is an IRS information reporting form. Payment networks and other providers use the form to report certain transactions from payment cards and through various payment networks. Third-party payment networks can include a range of providers that you’re likely familiar with like Venmo, PayPal(opens in new tab), Stripe, and CashApp. And if you sell on Etsy, eBay(opens in new tab), Depop, or other similar sites, you probably process payments through third party networks as well.
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