1099-K reporting requirements for payment settlement entities

Reporting requirements

The One, Big, Beautiful Bill (OBBB) retroactively reinstated the reporting threshold in effect prior to the passage of the American Rescue Plan Act of 2021 (ARPA) so that a third party settlement organization (TPSO) is not required to file a Form 1099-K unless the gross amount of reportable payment transactions to a payee exceeds $20,000 and the number of transactions exceeds 200.

Under the ARPA reporting threshold, TPSOs, which are a type of payment settlement entity (PSE), were required to file Form 1099-K for any payee that received more than $600 in total payments for the sales of goods or services, regardless of the number of transactions. Subsequently, Notices 2023-10, 2023-74 and 2024-85 were issued to provide transition periods and penalty relief for the implementation and enforcement of the ARPA changes to the reporting threshold for TPSOs.

Verification processes

We verify that tax returns are correct and complete using the following processes:

• TIN Matching Program

  Use the IRS Taxpayer Identification Number (TIN) Matching Program, an internet-based pre-filing e-service, to ensure the Forms 1099-K you submit have the correct TIN. The program allows you to verify the TIN furnished by the taxpayer against IRS records prior to filing information returns.

• Name control

  The name control (a sequence of characters derived from a taxpayer's name) and TIN on an electronically filed return must match our records. Refer to Reasonable Cause Regulations and Requirements for Missing and Incorrect Name/TINs PDF for more information.

Filing deadlines & procedures

Your Form 1099-Ks are due to merchants by January 31. In addition, your Form 1099-K is due to the Internal Revenue Service by the following dates: 

• February 28 for paper filing. For more information review General Instructions for Certain Information Returns.
• March 31 for electronic filing using the online FIRE System (Filing Information Returns Electronically). For more information review Publication 1220 PDF.

More information

You can find more about Form 1099-K and other information returns at:

• FAQs on payment card and third-party network payments
• Understanding your Form 1099-K
• Gig economy tax center