Understanding your Form 1099-K

Form 1099-K is a report of payments you got for goods or services during the year from:

• Credit, debit or stored value cards such as gift cards (payment cards)
• Payment apps or online marketplaces, also called third party settlement organizations or TPSOs

These organizations are required to fill out Form 1099K and send copies to the IRS and to you.

Payments you got from family and friends should not be reported on Form 1099-K.

Use Form 1099-K with other records to help you figure and report your taxable income when you file your tax return.

Did you get a Form 1099-K? Find what to do with it on IRS.gov/1099khelp.

On this page

• Who sends Form 1099-K
• Who gets Form 1099-K
• Reporting threshold
• Personal payments from family and friends

Who sends Form 1099-K

Payment card companies, payment apps and online marketplaces are required to fill out Form 1099-K and send it to the IRS each year. They must also send a copy to you by January 31.

Who gets Form 1099-K

You should get Form 1099-K for these situations:

If you take direct payment by credit or bank card for selling goods or providing services

If your customers or clients pay you directly by credit, debit or gift card, you'll get a Form 1099-K from your payment processor or payment settlement entity, no matter how many payments you got or how much they were for.

Find what to do with Form 1099-K.

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If you used a payment app or online marketplace and received a Form 1099-K

A payment app or online marketplace is required to send you a Form 1099-K if the payments you received for goods or services total over $5,000. However, they can send you a Form 1099-K with lower amounts. Whether or not you receive a Form 1099-K, you must still report any income on your tax return.

This includes payments for any:

• Goods you sell, including personal items such as clothing or furniture
• Services you provide
• Property you rent

The payments can be made through any:

• Payment app
• Online community marketplace
• Craft or maker marketplace
• Auction site
• Car sharing or ride-hailing platform
• Ticket exchange or resale site
• Crowdfunding platform
• Freelance marketplace 

If you accept payments on different platforms, you could get more than one Form 1099-K.

Personal payments from family and friends should not be reported on Form 1099-K because they are not payments for goods or services.

Find what to do with Form 1099-K.

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Reporting threshold

Notice 2024-85 PDF issued 11/26/2024, provides guidance and clarifies that third party settlement organizations are required to report transactions for goods or services where the total payments received were more than $5,000 in 2024; more than $2,500 in 2025; and more than $600 in calendar year 2026 and thereafter.

There are no changes to what counts as income or how tax is calculated.

The reporting threshold for third party settlement organizations, which include payment apps and online marketplaces, was changed to $600 by the American Rescue Plan Act of 2021.

Although the IRS is taking a phased in approach to implementation of the Form 1099-K reporting threshold companies could still send the form for totals over $600.

No matter the amount, if you receive payments for selling goods or services or renting property you must report your income.

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Personal payments from family and friends

Money you received from friends and family as a gift or repayment for a personal expense should not be reported on a Form 1099-K. These payments aren't taxable income.

For example: Sharing the cost of a car ride or meal, receiving money for birthday or holiday gifts or getting repaid by a roommate for rent or a household bill.

Be sure to note these types of payments as non-business in the payment apps when possible.

If you receive a Form 1099-K when you shouldn't have, take these steps.

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