IRS Revises and Updates Form 1099-K FAQs
In an effort to provide more resources for taxpayers during this filing season, the IRS recently revised frequently asked questions (FAQs) for Form 1099-K, Payment Card and Third Party Network Transactions, in Fact Sheet 2024-03.
The revised FAQs provide more general information for taxpayers, along with more clarity for industry and what organizations should send Forms 1099-K. The FAQs are in addition to a recently updated Understanding your Form 1099-K page and other communications resources.
The updates to the FAQs contain substantial changes within each section:
- General Information
- What to Do If You Receive a Form 1099-K
- Common Situations
- Third Party Filers of Form 1099-K
- Should My Organization Be Preparing, Filing and Furnishing Form 1099-K?
Following feedback from taxpayers, tax professionals and payment processors, and to reduce taxpayer confusion, the IRS announced on Nov. 21, 2023, in Notice 2023-74, that it will delay the new $600 Form 1099-K reporting threshold for third-party settlement organizations for calendar year 2023.
As the IRS continues to work to implement the new law, the agency is treating 2023 as an additional transition year, which applies to taxes filed this year. As a result, reporting will not be required unless the taxpayer receives over $20,000 and has more than 200 transactions in 2023, although taxpayers may still receive a form for amounts less than the required reporting amount.