The IRS has announced a change to the requirements that third-party settlement organizations (TPSOs), also known as payment apps and online marketplaces, have regarding reporting transactions during calendar years 2024 and 2025 on Form 1099-K.
Under the issued guidance, TPSOs will be required to report transactions when the amount of total payments for those transactions is more than $5,000 in 2024; more than $2,500 in 2025; and more than $600 in calendar year 2026 and after.
What this means for you
If you receive payments from TPSO (such as PayPal, Amazon, Etsy, or other online marketplaces), this announcement may change whether you should be expecting a Form 1099-K. As always, if you do receive a Form 1099-K be sure to include it in the material that you provide us when we prepare your tax return.