More individuals will receive a Form 1099-K (payment card and Third-party Network transaction) from PayPal, Airbnb, Amazon, eBay, etc.
As of today these forms are sent only for those with over 200 transactions and paid over $20.000.
Starting 2022 all who received a minimum of $600 amount and no transaction limit will receive a form 1099-K. Get ready to report correctly your income to eliminate red flags for IRS
What is Form 1099-K?
Form 1099-K is used to report payment card and third-party network transactions. Much like the alphabet soup of other 1099 forms, one copy is sent to the taxpayer, while another copy is filed with the IRS. Although the lack of a 1099 form doesn’t absolve a taxpayer of the responsibility to report any income, it’s a lot easier for the IRS to track compliance when that income is reported on 1099.
The key point with the changes to reporting thresholds is that the tax law itself remains unchanged—you have always been responsible for reporting income you earn through online marketplaces like Airbnb, PayPal, Amazon, etc. Capturing more transactions via form 1099-K enables the IRS to step up its enforcement and collection efforts.