2023 1099-K Threshold Reporting

The IRS has announced they are delaying lower 1099-K reporting for another year, but not for credit card transactions.

The IRS will treat 2023 as an additional transition year for implementation of the American Rescue Plan Act’s lower 1099-K reporting threshold, but only for third-party network transactions, such as Venmo, PayPal, Apple Pay, online marketplaces, etc.

The IRS will not regard 2023 as a transition year for payment card transactions, which are transactions where a customer pays with a credit card, such as Visa, Mastercard, or American Express.

This means that taxpayers who receive payments through third-party network transactions should not receive Form 1099-K for the 2023 taxable year, unless the aggregate payments received through a single third-party network exceeded $20,000 and the total number of transactions exceeded 200 for the year.

However, taxpayers should expect to receive Form 1099-K for the 2023 taxable year for credit card transactions if the aggregate payments received through a single credit card company exceeded $600, regardless of the number of transactions.

In the IRS’s press release announcing the 1099-K reporting delay, it stated that at a later date it intends to announce a filing threshold for third-party network transactions for 2024 of $5,000.

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