2024 1099 sales requirements

https://www.irs.gov/newsroom/irs-announces-delay-in-form-1099-k-reporting-threshold-for-third-party-platform-payments-in-2023-plans-for-a-threshold-of-5000-for-2024-to-phase-in-implementation

@workbob567 wrote:
Anyone know what the requirements for the 1099 in 2024 are. I thought I read $ 5,000 in sales but is there a limit to the number of sales

Nobody knows, not even the IRS.

The finalized threshold for 2022 was announced by the IRS in December 2022; the finalized threshold for 2022 was announced in November 2023, at which time IRS proposed that the threshold for 2024 would be $5000. So don't count on getting their final decision before December 2024.

Here's a link to the November 2023 announcement in which the IRS explained that the federal threshold for 2023 would remain at the old $20K, and that they are "planning for a threshold of $5,000 for tax year 2024". They didn't mention any number of transactions, so we have to assume it's just one.

And as noted innumerable times in threads about this topic: this threshold applies to the requirement or companies to send a 1099-K, not to any threshold for taxpayers in reporting their income.

dbfolks166mt

·2 years ago

NOBODY here can answer your question since nothing has been codified at the Federal level for 2024 and may very well not be until late in the calendar year. There is also the possibility that due to the ineptitude at the Federal level more states may begin to pass their own 1099-K issuance thresholds through the year.

monica-sells

·2 years ago

91 View listings

@dbfolks166mt wrote:
NOBODY here can answer your question since nothing has been codified at the Federal level for 2024 and may very well not be until late in the calendar year. There is also the possibility that due to the ineptitude at the Federal level more states may begin to pass their own 1099-K issuance thresholds through the year.

Requoted (with emphasis) in case this was missed

As soon as other states notice the revenue increases at the STATE level of the states that have that $600 threshold, you can bet they will implement that for their own states....ASAP

mr_lincoln

·2 years ago

5042 View listings

Hi @workbob567

I agree with @rosszonebricks on this subject, just report what you sell and let the 1099K take care of itself if you get one.

1786davycrockett

·2 years ago

5692 View listings

@workbob567

In 2023, the Internal Revenue Service did not change its rules until late in the year (November, maybe?).

So just do the paperwork as you would expect to do, under ANY possible circumstances.

fern*wood

·2 years ago

10492 View listings

It seems to be a moving target, but the only ones this impacts are the payment processors that have to issue them. It doesn't change anything about reporting ebay sales.

rosszonebricks

·2 years ago

https://www.irs.gov/newsroom/irs-announces-delay-in-form-1099-k-reporting-threshold-for-third-party-platform-payments-in-2023-plans-for-a-threshold-of-5000-for-2024-to-phase-in-implementation

"limit to the number of sales" ?

That's not how it works. Sell as much and as many things as you like! More sales, more profit!

Does the 1099k threshold have ANYTHING to do with your requirement to pay taxes on your *profit* from sales?

Nope, not one bit.

It seems for states not already implemented lower than $5000 (Illinois and New Jersey are $1000... Maryland, Massachusetts, DC, Montana, Vermont, Virginia are $600) that in 2024 it will be $5000.

soh.maryl

·2 years ago

When you mention the limits for those various states, does that refer to the reporting threshold for STATE income tax, rather than Federal? Could not picture individual states being able to set the guidelines for Federal income tax reporting.

rosszonebricks

·2 years ago

@soh.maryl wrote:
When you mention the limits for those various states, does that refer to the reporting threshold for STATE income tax, rather than Federal? Could not picture individual states being able to set the guidelines for Federal income tax reporting.

1099K thresholds are just what is required for being issued a 1099K. Remember, getting (or not getting) a 1099k does not alone determine if you are required to pay taxes on any income that 1099k represents.

So no, a state with a $20,000 threshold or a $600 threshold has no bearing on your requirement to pay your Federal (or state) income tax.

soh.maryl

·2 years ago

Yes, I am aware of that. My concern here is that some of the replies here imply that states can set the reporting level for Federal income tax.

soh.maryl

·2 years ago

Yes, I know that. The reason for my original message was that some of the responses here seemed to indicate that individual states make the rules for the Federal level and most of us know that's not the case.

soh.maryl

·2 years ago

This, I promise, will be my last post on this topic. Am aware that a state's requirement for the level at which a person has to file a state income tax form has no bearing on the Federal requirements.

My point was that some of the responses here appear to imply that the two are connected and they are not.

dbfolks166mt

·2 years ago

For clarity are you talking about the states 1099-K issuance requirement or state income tax forms. The 1099-K is a Federal form not a state one and while it may get issued because of a state law it will be sent to the IRS at the Federal level and possibly at the state level as well.

My point was that some of the responses here appear to imply that the two are connected and they are not.

If you are talking strictly about the 1099-K issuance due to state laws and it not being directly connected to the Federal requirements for the 1099-K then yes you are correct. However, from an income tax filing perspective or the bigger picture they are connected.

soh.maryl

·2 years ago

Respectfully, other than probably containing the same information, how are they connected?

dbfolks166mt

·2 years ago

Respectfully, other than probably containing the same information, how are they connected?

The 1099-K is a Federal form not a state one so the state law in essence negates or overrides the Federal requirement. The IRS at the Federal level does not require the issuance for any third party financial processing below $20K but because the state does the IRS gets the form anyway.

Since they get the form and despite the fact that the Federal level does not require it it would be advisable to claim the income on your federal taxes, which you should do anyway, and in most cases the Federal tax return information feeds the state form.

nobody*s_perfect

·2 years ago

@soh.maryl wrote:
When you mention the limits for those various states, does that refer to the reporting threshold for STATE income tax, rather than Federal? Could not picture individual states being able to set the guidelines for Federal income tax reporting.

The states set the requirements which apply to their own state income tax, including the thresholds at which companies are required to issue a 1099-K. Then if a company issues a 1099-K (for any amount) they are required to send it to the IRS as well as to the individual and to that individual's state tax authority.

soh.maryl

·2 years ago

Guess I should have mentioned that I am well aware of the difference between a taxpayer's state income tax and the Federal income tax.

My concern here is that several of the answers here make it sound like the states can set the level for reporting for the purpose of federal income tax and most of us know there's a difference.

dbfolks166mt

·2 years ago

Guess I should have mentioned that I am well aware of the difference between a taxpayer's state income tax and the Federal income tax.

My concern here is that several of the answers here make it sound like the states can set the level for reporting for the purpose of federal income tax and most of us know there's a difference.

By default they sort of do. Because the 1099-K is a Federal form it gets sent to the IRS at the federal level and potentially at the state level as well. While sellers should be reporting all income, regardless of whether they receive a 1099-K or not, just because a state may have a different 1099-K issuance threshold than the Federal level, it would be ill advised to just claim the income on your state income taxes because your state has a lower issuance threshold, and not claim it on your Federal income tax because you were below the Federal issuance level.

Doing so may be difficult anyway since a lot of state income tax forms are fed from the information you provide on your Federal income tax return.

soh.maryl

·2 years ago

Yes, I know how it works. It's just that some of the replies here seem to imply that the individual states can make the decision for the IRS as to the reporting threshold and most of know that that is simply not the case.

2 years ago

1030 View listings

They can and do - for those that live in their state. If the IRS requires 1099's for $10,000 and an individual state goes with $1,000 (let's just say Hawaii just for fun), that triggers eBay, Amazon, etc. to issue 1099's for sellers with >$1,000 in sales that reside in Hawaii. With that issuance, the 1099 is reported to the IRS, even though it was Hawaii that required the issuance. Sure, there isn't an IRS reg that dictates that 1099's are issued for that small amount for those in Hawaii, but the Hawaii state gov't effectively made the decision on the reporting threshold.

dbfolks166mt

·2 years ago

The 1099-K is a federal form not a state one, and for good reason. When the 1099-K is issued it goes to the IRS at the federal level as well as potentially to the individual state depending on the various state laws.

Buying & Selling

Selling

2024 1099 sales requirements

Anyone know what the requirements for the 1099 in 2024 are. I thought I read $ 5,000 in sales but is there a limit to the number of sales

workbob567

961 View listings

Posted 2 years ago·Last reply 2 years ago

22 comments

caldreamer

·2 years ago

4043 View listings

Some states have 1099 requirements as low as $600. IRS requires that you report every dollar of income (whether you get a 1099 or not).

nobody*s_perfect

·2 years ago

https://www.irs.gov/newsroom/irs-announces-delay-in-form-1099-k-reporting-threshold-for-third-party-platform-payments-in-2023-plans-for-a-threshold-of-5000-for-2024-to-phase-in-implementation

@workbob567 wrote:
Anyone know what the requirements for the 1099 in 2024 are. I thought I read $ 5,000 in sales but is there a limit to the number of sales

Nobody knows, not even the IRS.

And as noted innumerable times in threads about this topic: this threshold applies to the requirement or companies to send a 1099-K, not to any threshold for taxpayers in reporting their income.

dbfolks166mt

·2 years ago

monica-sells

·2 years ago

91 View listings

@dbfolks166mt wrote:
NOBODY here can answer your question since nothing has been codified at the Federal level for 2024 and may very well not be until late in the calendar year. There is also the possibility that due to the ineptitude at the Federal level more states may begin to pass their own 1099-K issuance thresholds through the year.

Requoted (with emphasis) in case this was missed

As soon as other states notice the revenue increases at the STATE level of the states that have that $600 threshold, you can bet they will implement that for their own states....ASAP

mr_lincoln

·2 years ago

5042 View listings

Hi @workbob567

I agree with @rosszonebricks on this subject, just report what you sell and let the 1099K take care of itself if you get one.

1786davycrockett

·2 years ago

5692 View listings

@workbob567

In 2023, the Internal Revenue Service did not change its rules until late in the year (November, maybe?).

So just do the paperwork as you would expect to do, under ANY possible circumstances.

fern*wood

·2 years ago

10492 View listings

It seems to be a moving target, but the only ones this impacts are the payment processors that have to issue them. It doesn't change anything about reporting ebay sales.

rosszonebricks

·2 years ago

https://www.irs.gov/newsroom/irs-announces-delay-in-form-1099-k-reporting-threshold-for-third-party-platform-payments-in-2023-plans-for-a-threshold-of-5000-for-2024-to-phase-in-implementation

"limit to the number of sales" ?

That's not how it works. Sell as much and as many things as you like! More sales, more profit!

Does the 1099k threshold have ANYTHING to do with your requirement to pay taxes on your *profit* from sales?

Nope, not one bit.

It seems for states not already implemented lower than $5000 (Illinois and New Jersey are $1000... Maryland, Massachusetts, DC, Montana, Vermont, Virginia are $600) that in 2024 it will be $5000.

soh.maryl

·2 years ago

rosszonebricks

·2 years ago

@soh.maryl wrote:
When you mention the limits for those various states, does that refer to the reporting threshold for STATE income tax, rather than Federal? Could not picture individual states being able to set the guidelines for Federal income tax reporting.

So no, a state with a $20,000 threshold or a $600 threshold has no bearing on your requirement to pay your Federal (or state) income tax.

soh.maryl

·2 years ago

Yes, I am aware of that. My concern here is that some of the replies here imply that states can set the reporting level for Federal income tax.

soh.maryl

·2 years ago

soh.maryl

·2 years ago

My point was that some of the responses here appear to imply that the two are connected and they are not.

dbfolks166mt

·2 years ago

My point was that some of the responses here appear to imply that the two are connected and they are not.

soh.maryl

·2 years ago

Respectfully, other than probably containing the same information, how are they connected?

dbfolks166mt

·2 years ago

Respectfully, other than probably containing the same information, how are they connected?

nobody*s_perfect

·2 years ago

@soh.maryl wrote:
When you mention the limits for those various states, does that refer to the reporting threshold for STATE income tax, rather than Federal? Could not picture individual states being able to set the guidelines for Federal income tax reporting.

soh.maryl

·2 years ago

Guess I should have mentioned that I am well aware of the difference between a taxpayer's state income tax and the Federal income tax.

My concern here is that several of the answers here make it sound like the states can set the level for reporting for the purpose of federal income tax and most of us know there's a difference.

dbfolks166mt

·2 years ago

Guess I should have mentioned that I am well aware of the difference between a taxpayer's state income tax and the Federal income tax.

My concern here is that several of the answers here make it sound like the states can set the level for reporting for the purpose of federal income tax and most of us know there's a difference.

Doing so may be difficult anyway since a lot of state income tax forms are fed from the information you provide on your Federal income tax return.

soh.maryl

·2 years ago

2 years ago

1030 View listings

dbfolks166mt

·2 years ago