Form 1099-K
What Is a Form 1099-K?
Copy section linkA Form 1099-K is an official IRS tax form used to report payments you received for goods or services through payment cards or third-party networks like PayPal, Stripe, or Airbnb. It helps both you and the Internal Revenue Service (IRS) track taxable income during the tax year.
Key callout: You’ll receive a Form 1099-K if your total payments through these platforms exceed $600 for the calendar year. This form does not apply to personal gifts, reimbursements, or non-business transactions.
You’ll typically receive a 1099-K form by January 31 following the tax year. It summarizes your gross payments — the total amount before subtracting fees, refunds, or other adjustments.
Who Gets a 1099-K Form
Copy section linkThe IRS Form 1099-K applies to individuals and businesses that accept payments for goods or services through online platforms or card processors. You may receive a 1099-K if you’re:
- A small business owner accepting card payments;
- A freelancer or gig worker using PayPal, Upwork, or Fiverr;
- An online merchant or reseller (eBay, Etsy, Ticketmaster, etc.);
- A property manager or Airbnb host;
- A person selling personal items online at a profit.
Who Issues a 1099-K Form
Copy section linkPayment processors and third-party platforms are responsible for sending Form 1099-K to both you and the IRS. These entities are known as Payment Settlement Entities (PSEs) or Third-Party Settlement Organizations (TPSOs).
Common issuers include:
Merchant banks: Chase, Citigroup;
Card processors: Square, Stripe;
Online platforms: PayPal, Shopify, Etsy;
Peer-to-peer apps: Venmo (Business), Cash App (Business);
Marketplaces: eBay, Airbnb, Uber, Ticketmaster.
Parties Involved in a Form 1099-K
Copy section linkThe Filer (The Payer)
The PSE or TPSO that processes payments and issues the form.
Examples: PayPal, eBay, Stripe, or your merchant bank.
The Recipient (The Payee)
The individual or business that receives payments for goods or services.
Examples: Freelancers, gig workers, small business owners, or online sellers.
The IRS (Internal Revenue Service)
The federal agency that monitors tax compliance. The filer sends a copy of Form 1099-K to the IRS, which matches the reported income with your tax return.
The Parts of a 1099-K Form
Copy section linkEach section of the Form 1099-K contains key details for accurate tax reporting:
- Filer’s Information: Name, address, and contact details of the payment processor.
- PSE / EPF: Identifies whether the filer is a Payment Settlement Entity or Electronic Payment Facilitator.
- Transactions Reported: Indicates payment card or third-party network transactions.
- Payee’s Information: Details of the recipient (you).
- Filer and Payee TINs: Taxpayer Identification Numbers for both parties.
- Box 1a – Gross Payments: Total amount received (not reduced by fees or refunds).
- Box 1b – Card Not Present: Online or phone transactions.
- Box 3 – Number of Transactions: Total transactions reported.
- Box 4 – Federal Tax Withheld: Shows backup withholding, if any.
- Boxes 5a–5l – Monthly Totals: Monthly breakdown of gross payments.
- Boxes 6–8 – State Taxes: Withheld state/local income tax amounts.
Important Terms
- Gross Amount: Total received before any deductions.
- Reportable Payment Transactions: Payments for goods/services only.
- Taxable Income: You report profit, not the gross amount, on Schedule C or Schedule D when filing your tax return.
How to Fill and File a Form 1099-K
Copy section linkWith Loio, you can fill, sign, and store your Form 1099-K online — no need for external software or manual printing.
- Collect Payee Information — Obtain the payee’s Taxpayer Identification Number (TIN) via Form W-9.
- Complete All Form Sections — Use Loio’s fillable 1099-K form template to enter filer, payee, and payment details.
- Review for Accuracy — Double-check all transaction amounts and TINs.
- Submit to the IRS — Send Copy A to the IRS by mail or through an IRS-approved e-file system.
- Send to the Payee — Deliver Copy B to the payee by January 31.
- File with State (if required) — Submit Copy 1 to your state tax department.
- Keep a Record — Retain Copy C for your own business files.
Additional Documents You May Need
Copy section linkFrequently Asked Questions
Copy section link- Do I have to report 1099-K income?
Yes. Even if you don’t receive a form, you must report all income earned from goods or services on your tax return. - What’s the difference between a 1099-K and 1099-NEC?
Form 1099-K reports payments processed through cards or third-party platforms. Form 1099-NEC reports payments made directly by clients for services. - How do I get a 1099-K form?
It’s usually issued by your payment processor. You can also download it from your account dashboard (e.g., PayPal, Stripe, Shopify). - What is the new rule for 1099-K?
Starting in 2026, platforms must issue a Form 1099-K if total payments exceed $600 for goods or services — a significant change from the previous $20,000 threshold. - Will the IRS catch a missing 1099-K?
Yes. The IRS matches 1099-K reports with your tax return, so unreported income could trigger an audit letter from the IRS.
