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Form 1099-K: will you get one, and what it means
The 1099-K threshold is back to more than $20,000 and more than 200 transactions per platform. Add your payment apps, marketplaces and card processors to see which will send you a form.
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Short answer
Payment apps and online marketplaces (third party settlement organizations) must send a Form 1099-K only when your payments for goods and services on that platform exceed $20,000 and 200 transactions in the year. The One, Big, Beautiful Bill Act restored that threshold, cancelling the planned $2,500 (2025) and $600 (2026) limits. Card processors report card payments with no minimum. The amount is gross: fees, refunds and shipping aren't subtracted. Businesses leave card and app payments off their 1099-NECs.
- Both tests must be exceeded, per platform
- Personal gifts and repayments shouldn't be on a 1099-K
- States can set lower thresholds
- New on the 2026 form: box 1c (cash tips) and 1d (tipped occupation codes)
Last reviewed against the IRS Instructions for Form 1099-K (Rev. December 2026) and IRS news release IR-2025-107.
Will I get a 1099-K? One line per platform, for one calendar year.
What Form 1099-K is
Form 1099-K reports payments you received through a card network or a payment platform. It's filed by the company that processed the money, not by your customers, and it shows your gross payments for the year, month by month, before fees, refunds or shipping.
- Card processors (the company behind your card reader or online checkout) report your card payments, with no minimum amount.
- Payment apps and online marketplaces ("third-party settlement organizations", in IRS language) report what buyers paid you through them for goods and services, but only when you go over $20,000 and 200 transactions on that platform in the year.
How the threshold has changed
| Year | Threshold for payment apps and marketplaces |
|---|---|
| Before 2022 | Over $20,000 and over 200 transactions |
| 2022 and 2023 | A new $600 threshold was enacted in 2021, but the IRS delayed it, so $20,000 and 200 stayed in effect |
| 2024 | Platforms used a $5,000 transition threshold |
| 2025 onward | Back to over $20,000 and over 200 transactions: the One Big Beautiful Bill Act cancelled the planned $2,500 (2025) and $600 (2026) thresholds |
Both parts of the test must be exceeded, and each platform counts separately: $15,000 on one app and $15,000 on another means no federal 1099-K from either. States can set their own lower thresholds for state reporting.
If you pay contractors: 1099-K vs. 1099-NEC
The 1099-K matters to payers too. When you pay a contractor by credit card, debit card or a payment app's goods and services option, the processor is the one responsible for reporting it, on a 1099-K. You leave those payments off your 1099-NEC.
Payments by check, cash, ACH, wire or Zelle are yours to report. If you paid a contractor both ways, only the check and bank-transfer part counts toward the 1099-NEC threshold. Our Do I need to file a 1099? tool walks through it.
Got a 1099-K? What to do
- Check it against your records. The amount is gross: it includes fees, refunds, sales tax and shipping you collected.
- Make sure personal payments weren't included. If friends-and-family money was counted, ask the platform for a corrected form.
- Report business income as usual, then deduct fees, refunds and costs. The 1099-K doesn't change what's taxable, only that the IRS already knows about it.
- Make sure your TIN is right. Platforms collect a TIN just like a W-9 request, and a mismatch can trigger backup withholding on your payouts.
Related tools
- Paid contractors by check or bank transfer? Do I need to file a 1099?
- A form shows the wrong amount? Wrong or missing 1099.
- Platform asking for your TIN? How to fill out a W-9.
- Every form at a glance: the information return directory.
Sources
Questions
1099-K questions
What is the 1099-K threshold for 2025 and 2026?
For payment apps and online marketplaces, a 1099-K is required when a seller receives more than $20,000 in payments for goods or services across more than 200 transactions in the year, counted separately for each platform. The One Big Beautiful Bill Act restored this rule in 2025 and cancelled the planned $2,500 and $600 thresholds. Card processors report card payments with no minimum.
Who sends a 1099-K?
Payment settlement entities: card processors and merchant acquirers for credit and debit card payments, and third-party settlement organizations such as payment apps and online marketplaces for payments made through them.
Do personal Venmo or PayPal payments count?
No. Money sent between friends and family, like splitting dinner, gifts or reimbursing a roommate, isn't a payment for goods or services and isn't reportable. Mark personal payments as personal in the app so they aren't counted.
I'm a business that paid a contractor through PayPal. Do I send them a 1099-NEC?
Not for those payments. Payments by credit card, debit card or a payment app's goods and services option are reported by the processor on Form 1099-K, so leave them off your 1099-NEC to avoid reporting the same income twice. Payments by check, cash or bank transfer still go on the 1099-NEC.
I got a 1099-K for things I sold at a loss. Do I owe tax?
Selling personal items for less than you paid isn't taxable income, but the IRS has a copy of the 1099-K, so you report it and zero it out: the IRS says you can do that on Schedule 1 (Form 1040) or on Form 8949. The loss itself can't be deducted. For business sales, report them as business income as usual.
Can my state require a 1099-K below $20,000?
Yes. Several states have set lower thresholds for state reporting, so a platform may send you a 1099-K, or report to your state, even when no federal form is required. Check your state's revenue department.
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Paid contractors by check or bank transfer?
Those payments are yours to report on 1099-NEC. EFileForMe e-files them with the IRS, with bulk spreadsheet import and optional print & mail.