What is an IRS Form 1099-K?

IRS Form 1099-K is used to report the online transaction made through third-party network payment and credit card or debit card payment transactions. Payment settlement entities (PSE) fill out the form 1099-K to the IRS and State and send the recipient copies to the participating recipient before January 31st of each calendar year.

Who must File Form 1099-K?

Form 1099-k must be filed by Payment Settlement Entities (PSE) for payment made in the settlement of reportable payment transactions for each calendar year.

There are two types of PSE.

  • Third-Party Settlement Organization (TPSO)
  • Merchant Acquiring Entity(MAE)

Third-Party Settlement Organization:

An organization that has the contractual obligation to make payment to participating recipients of third-party network transactions.

Merchant Acquiring Entity:

An organization that has a contractual obligation to make payments to participating recipients in the settlement of payment card transactions.

What are the New Changes to Form 1099-K for 2023?

The IRS has released the Form 1099-K Changes for the 2023 tax year.

Changes2022 Tax Year2023 Tax Year
Threshold Limit$20,000$600
Transactions200Any Number of Transactions

Check out the latest changes of the form 1099-K threshold for 2023.

What Information is Required When Filing IRS Form 1099-K?

The following information is required to be reported when filing IRS Form 1099-K Online:

  • 1. Filer Details: Name, EIN and Address
  • 2. Payee Details: Name, SSN, Address and Account Number
  • 3. Payment settlement entity (PSE) or Electronic Payment Facilitator (EPF) or Other third-party Details
  • 4. Payment Details
    • Gross amount of payment card/third party network transactions
    • Card Not Present transactions
    • Merchant category code
    • Number of payment transactions
    • Federal income tax withheld
    • Total reportable payment transactions for each month

Know more about Form 1099-K Instructions.

When is the Form 1099-k Deadline for 2023?

Form 1099-K Deadlines for 2023 Tax Year are as follows:

  • Recipient Copy required to be mailed before the date of January 31, 2024.
  • Paper filing copies are required to be filed before the date of February 28, 2024.
  • Electronic filing copies are required to be e-filed before the date of April 01, 2024.

Completing Form 1099-K

The following steps are needed to complete the Form 1099-K Online:

  • Box 1a – Gross Amount Of Payment Card/Third-party Network Transactions
  • Box 1b – Card Not Present Transactions
  • Box 2 – Merchant Category Code
  • Box 3 – Number Of Payment Transactions
  • Box 4 – Federal Income Tax Withheld
  • Box 5a–5l – Gross Amount Of Payment Card/Third-party Network Transactions Made
  • Box 6–8 – State Income Tax Withheld

Learn more about Form 1099-K Instructions.

How to File Your IRS 1099-K Forms?

Similar to other IRS Forms, Form 1099-K can be filed in two different ways:

  • Paper Filing
  • Online Filing, or E-filing

Form 1099-K Paper Filing:

IRS accepts paper copies of 1099-K Form. However, If you are planning to file more than 250 copies you are required to e-file. Kindly, note that the deadline for paper filing Form 1099K is different from the E-filing deadline.

Generally, the IRS prefers E-file Form 1099-K over paper filing, because paper files are prone to errors, timing consuming, and hard to track the status of the filing reports.

Form 1099-K E-filing:

E-filing is one of the most preferred filing methods because electrical filing is more accurate, easy to file and you can get instant approval from the IRS. File 1099 K online with ExpressIRSForms authorized e-file provider for Form 1099, 94x, W-2, W-9, 1095 & more.

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