IRS – 1099K OVERVIEW 2023 Rule DelayDecember 22, 2023

Initially for the 2023 year, Forms 1099K that are issued by Third Party Settlement Organizations (ex. Credit card companies) and online sellers were supposed to issue a Form 1099K for transactions over $600. That has been delayed by the IRS and will not occur. Instead, the current rules will apply, that is, taxpayers who receive over $20,000 and have over 200 transactions will continue to receive the form.

The current plan for 2024 is an anticipated threshold of $5,000, however, this final amount has not been finalized. The threshold will eventually phase down to the $600 level.

Exclusions- Payments by a taxpayer related to payments for family and friends as a gift, reimbursement or a general family expense are not reportable transactions. If these types of payments are reported in the future, the taxpayer should report the amount on IRS Schedule 1 as both as income and expense and indicate amounts are received in error.

Taxpayers will continue to receive Forms 1099K from the reporting organization in January of the following year.

It is important to note that the delay of the 1099K reporting requirement does not change the fact that the IRS has always required taxpayers to report all taxable income, whether they receive a 1099K or not.

Additional information is available on the IRS website at:
https://www.irs.gov/newsroom/form-1099-k-frequently-asked-questions