Companies file 1099-Ks annually to report credit card and third-party payments in what's known as an "information return," with copies going to the IRS and the taxpayer.
Before 2022, taxpayers received 1099-Ks with more than 200 transactions worth an aggregate above $20,000. But the American Rescue Plan Act of 2021 dropped the threshold to just $600. Now, even a single transaction can trigger the form.the reporting change does not apply to personal transfers, such as gifts or reimbursements between friends and family. However, the agency explains what to do if you've received a 1099-K in error.
"If the information is incorrect on the 1099-K, taxpayers should contact the payer immediately, whose name appears in the upper left corner on the form," the IRS saidBut experts say it may be easier to address the 1099-K on your tax return, rather than waiting for Venmo, PayPal or other issuers to send a corrected form.
At the end of the day, you want the IRS computers to recognize that the 1099-K was reported on your return.Tommy Lucas, a certified financial planner and enrolled agent at Moisand Fitzgerald Tamayo in Orlando, Florida, suggests reporting the 1099-K onFor example, if you receive a 1099-K with $800 of income, you can report $800 under "proceeds" and $800 under "cost" for a net profit of $0, he explained.
I’m an IRS Enrolled Agent and was about to comment (basically saying the same strategy as what this article outlines). Good job!
Do we get to write off /apply cost of goods sold?
MiladAbdi a student of Social Work at Allameh Univ. was abducted 39 days ago. University 'security' cooperated with the IR thugs to abduct him, in detention, under pressure & violence for forced confessions, promised release several times without any results. MahsaAmini
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