IRS 1099-K Reporting online payments

Help Center For Landlord Accounting Income management

New rules for reporting online payments to the IRS.  $600 or more threshold (Previously $22,000).

Our payment partners, will file a tax form 1099-K with the IRS and relevant state agencies and send you, via email, a 1099-K Form for the recent year if you meet one or more of the following reporting thresholds:

  • From all payment card transactions (e.g., debit, credit, or stored-value cards), and
  • In settlement of third-party payment network transactions above the minimum reporting thresholds as follows:
    • For returns for calendar years prior to 2022:
      • Gross payments that exceed $20,000, AND
      • More than 200 such transactions
    • For returns for calendar years after 2021:
      • Gross payments for goods or services that exceed $600, AND
      • Any number of transactions

It is important to understand what the 1099-K is and isn’t. The federal form 1099-K is information on gross online payments and does not necessarily represent reportable income. It is different than the 1099-Misc and the 1099-NEC which are more aligned with income. 

Because the 1099-K is related to online payment flows there will be times when a tenant will receive a 1099-K, because of a return of a cleaning deposit. The new IRS rules require any amount sent online of $600 or more to be reported. This of course does not represent income. The reporting is based on showing the online movement of funds and is not directed at income.

The 1099-K is exclusive of payments sent online and will not reflect any payments accounted for in your accounting. (e.g. if a tenant pays with cash and your account for it in system that will not be reported on a 1099-k).  Online methods are currently limited to an ACH payment, Credit Card payment, or Debit card payment. 

The form should be used in conjunction with other tax records (bank statements, invoices, etc.) to report taxable income if any. Please consult your tax advisor to determine your tax reporting requirements.

For more information about the 1099-K, you can read it here on the IRS website. 

Please consult your tax advisor to determine your tax reporting requirements.
For any questions regarding 1099-Ks, please contact our Support team.
 

Last updated:
Feb. 6, 2023

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