Form 1099-K Gets An Overhaul

If you received more than $600 from various online payment processors, you'll receive the updated Form 1099-K, Payment Card and Third-Party Network Transactions.

WHAT'S CHANGED?

Previously, when a company collected debit and credit card payments from customers, the card processor issued Form 1099-K that showed the gross amount of cash it provided to the business.

Now, more Americans will receive Form 1099-K. Beginning in tax year 2022, individuals, partnerships, LLCs, and corporations that earn more than $600 annually from third-party settlement organizations (e.g., PayPal) or electronic payment facilitators (e.g., Shopify or Xero which helps companies invoice and collect from customers) will receive a Form 1099-K.

WHO'S IMPACTED?

Some examples of who may be impacted by these changes if they meet the $600 reporting threshold include:

• Homeowners renting out their homes on marketplaces like Airbnb


• Delivery drivers working for food delivery apps like Uber Eats or Grubhub


• Gig freelance workers offering their services on sites like Upwork


• Online retailers selling goods on platforms like eBay or Etsy