About the 1099-K Form
The 1099-K Form is a tax document that third-party payment platforms send to everyone who makes business transactions through these platforms to record their income for tax purposes.
Everyone who makes business transactions or receives payment via online platforms must report their income through the 1099-K Form once they cross the stipulated minimum threshold. Before the 2021 Rescue Plan, the minimum threshold was $20,000, and 200 transactions in a year.
Changes Involving the 1099-K Form
Following the American Rescue Plan of 2021, the minimum threshold of reporting business transactions on third-party platforms was reduced significantly, from $20,000 to $600, with no minimum number of transactions.
According to the IRS, these changes will take effect in the 2023 reporting period.
This means that everyone, including freelancers and small business owners, who conduct business transactions using any third-party platform will receive the 1099-K Form once they receive up to $600 within a year.
Get Help with Your 1099-K Form in Fort Mill, South Carolina
If you make business transactions via third-party platforms like Zelle or PayPal and need help tracking your income, understanding the 1099-K Form, and reporting your income, Abacus Tax & Books can provide you with support.
Abacus Tax & Books is a reputable accounting firm in Fort Mill, South Carolina, committed to helping small to medium business owners to simplify their bookkeeping and tax preparation. For inquiries, contact Abacus Tax and Books at 803-548-1099.