1099-K - Overview
A payment settlement entity (PSE) must file Form 1099-K for payments made in settlement of reportable payment transactions for each calendar year. A PSE makes a payment in settlement of a reportable payment transaction, that is, any payment card or third party network transaction, if the PSE submits the instruction to transfer funds to the account of the participating payee to settle the reportable payment transaction.
See below for the federal threshold, as well as for the specific state threshold, if lower than the federal. Please note that to the extent that there is any withholding, no threshold is applicable.
Please note: The federal threshold for the IRS that is listed applies for all tax years. Although there were some changes in recent years, the latest update was meant to be applied retroactively.
|
Regime |
Threshold |
|---|---|
|
Federal |
Greater than $20,000 and more than 200 transactions Note that this threshold only applies to third party network transactions, and not payment card transactions. |
|
Arkansas |
$2,500 or more |
|
District of Columbia |
$600 or more |
|
Illinois |
$1,000 or more (must have 4 or more separate transactions) |
|
Maryland |
$600 or more |
|
Massachusetts |
$600 or more |
|
Montana |
$600 or more |
|
New Jersey |
$1,000 or more |
|
Vermont |
$600 or more |
|
Virginia |
$600 or more |
Deadlines
See below for the deadlines relevant to the Form 1099-K:
- January 31st is the last day to deliver forms to recipients
- March 31st is the last day to submit filings
If a deadline falls on a weekend or holiday, it will be extended to the next business day. A 30-day extension is generally available for both of the deadlines above.
Resources
Please see the Form 1099-K – IRS Form & Instructions for official IRS information.
Please refer to the 1099-K - Data Requirements guide for detailed data requirements.
Below are the applicable CSV Ingestion Templates:
- 1099-K Form Data CSV Template – Only required if not sending transactions
A sample form is also attached to the bottom of this article for your reference.
Data Requirements
See below for all of the required data elements for completing Form 1099-K reporting.
Filing Entity
The legal entity responsible for the issuing forms will be the filing entity. The information listed below must be submitted through the Taxbit Dashboard.
For more information on Filer setup, please refer to this guide: Filer Setup
|
Field Name |
Required |
|
Name |
Required |
|
Address |
Required |
|
Tax Residency |
Required |
|
US TIN |
Required |
|
Contact Phone Number |
Required |
|
1099-K Filer Type |
Required |
|
1099-K Transaction Type |
Required |
|
PSE Name |
Only required if the Filer Type is Electronic Payment Facilitator(EPF)/Other third party |
|
PSE Telephone Number |
Only required if the Filer Type is Electronic Payment Facilitator(EPF)/Other third party |
Please note: If there are multiple filers, please ensure that you are using the correct filer ID for the associated account(s).
Account Owner / Account
For ingestion purposes, the only data point required to create/update an Account Owner is the Account ID. This allows you to add all of your users to the Dashboard, even while you may still be collecting additional information. There will be reports available in the Dashboard to let you know if something is missing for an Account that is eligible for a tax form.
For more information on formatting the Account Owner/Account CSV templates, please refer to this guide: Standard Account Owner/Account - CSV Ingestion Template Guide
The following table, however, summarizes the required fields needed to complete the Form 1099-K.
|
Field Name |
Required |
|
Account Owner ID |
Only required if you have Account Owners with multiple Accounts |
|
Account ID |
Required |
|
Name |
Required |
|
Joint Account Name |
If Applicable |
|
Address |
Required |
|
Tax Residency |
Presumed US if unavailable |
|
TIN |
Required |
|
Filer ID |
Only required if you have multiple Filers |
Please note: There are other fields on the Account Owner / Account model that are not listed here, as they are not required for 1099-K reporting.
Transactions or Form Data
For account activity, we can either collect raw transaction data, in which case Taxbit will complete the aggregations and determine the ultimate data to report on the Form 1099. If you are doing the aggregations already, then we also offer the option of sending us Form Data, which would include the final amounts that go on the form.
Transactions
For the Form 1099-K, the only applicable transaction type is Income, with a subtype of either Payment-Goods, or Payment-Services.
|
Field Name |
Required |
|
Account ID |
Required |
|
Transaction ID |
Required |
|
Date and Time |
Required |
|
Transaction Type |
Required: Income |
|
Transaction Subtype |
Required: Payment-Goods or Payment-Services |
|
Received Asset Quantity, Currency, and Rate/USD Value |
Required |
|
Sent Asset Quantity, Currency, and Rate/USD Value |
Not Applicable |
|
Fee Asset Quantity, Currency, and Rate/USD Value |
If Applicable |
Form Data
To the extent transactions are not being provided, and Taxbit is not handling aggregations, the following data points must be provided for Form Data ingestion.
Note that there should typically be a single row for each Account in the template; however, if the income applies to multiple states, there may be a separate row for each state. The state field is only required if there is state withholding, or if the income is attributable to a state that is different from the Account Owner’s address.
Please note: The sum of the amounts for each month (Box 5a-5i) should be equal to the amount indicated in Box 1a.
For more information on formatting the 1099-K Form Data CSV template, please refer to this guide: 1099-K - Form Data CSV Ingestion Template Guide
|
Field Name |
Required |
|
Account ID |
Required |
|
Gross amount of payment card/third party network transactions (Box 1a) |
Required |
|
Card Not Present transactions (Box 1b) |
If Applicable |
|
Merchant category code (Box 2) |
If Applicable |
|
Number of payment transactions (Box 3) |
Required |
|
January (Box 5a) |
Required |
|
February (Box 5b) |
Required |
|
March (Box 5c) |
Required |
|
April (Box 5d) |
Required |
|
May (Box 5e) |
Required |
|
June (Box 5f) |
Required |
|
July (Box 5g) |
Required |
|
August (Box 5h) |
Required |
|
September (Box 5i) |
Required |
|
October (Box 5j) |
Required |
|
November (Box 5k) |
Required |
|
December (Box 5l) |
Required |
|
Federal income tax withheld (Box 4) |
If Applicable |
|
State (Box 6) |
Only required if there is state withholding, or the income is applicable to a state that is different from the address state |
|
State identification no. (Box 7) |
If Applicable |
|
State income tax withheld (Box 8) |
If Applicable |