1099-K Threshold for 2024 & 2025

[marin-hpd]

https://www.ebay.com/help/selling/fees-credits-invoices/ebay-form-1099k?id=4794&external=1

Why does this form say $600 for 2024?

[nobody*s_perfect]

Because that is the official federal threshold, for the past few years.  The IRS has been delaying the implementation, but eBay (and everyone else) has to continue operating as if the $600 was in effect, until we hear otherwise.

In 2022, the IRS announced in December that rather than implementing the federal $600 threshold they would continue to use the old $20K threshold.  

In 2023, the official IRS announcement about the $20K threshold for the year came out in November, and included a comment that they plan to have  a threshold of $5000 for 2024, but it's not official yet and we might not hear  for several weeks.

[marin-hpd]

@nobody*s_perfect thanks for your answer. I sold a used lens for less than what I paid for, which I bought from Craigslist in cash and no receipt. My wife sold her used clothes in her account. 
Will eBay combine two accounts (different tax IDs) to issue one 1099-K form if the total from the two accounts exceeds the limit?
Thanks.

[nobody*s_perfect]

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@marin-hpd wrote: ... 

Will eBay combine two accounts (different tax IDs) to issue one 1099-K form ...

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1099-Ks are based on the associated Social Security number. If the two accounts have different SSN's then eBay will not connect them.  If either account reaches the current threshold (federal or state) than that account will get a 1099-K.

[239rodney]

What is the threshold for Florida?

[albertabrightalberta]

@marin-hpd  and any other lurkers: 

Whether or not you get a 1099K form doesn't change whether you have to report your income! All income MUST be reported. 

[mam98031]

@marin-hpd 

Myth: If taxpayers didn't receive a Form 1099-K, they don't have to report income.

Fact: According to federal law, all income is taxable unless it is specifically excluded by tax law. Taxpayers should report any profits from selling goods or services, regardless of if they receive a Form 1099-K.

https://www.irs.gov/newsroom/irs-never-mind-the-myths-know-the-facts-about-receiving-a-form-1099-k-i...

[brightlightbookseller]

@239rodney, Florida follows the Federal guidelines, whatever they may finally shake out to be.  So for right now the threshold for a 1099K in Florida is $600.

[239rodney]

I understood the IRS memo for 2024 is $5,000 for Ebay sellers

[brightlightbookseller]

Nope, there is no such memo.  There are plans (which may or may not happen) for the 1099K threshold to be raised, but nothing actually enacted yet.  For now the threshold is as the law says, $600.  Regardless, it's just a form.  It has no impact on how much you will owe on your taxes, and actually simplifies your taxes somewhat usually.

[lacemaker3]

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@239rodney wrote:

I understood the IRS memo for 2024 is $5,000 for Ebay sellers

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Last year, when the IRS said they would delay the $600 implementation for 2023, they also said they were planning to use $5,000 for 2024.

Since then, the IRS has not announced anything to implement that plan, so at the moment, the "official" word is that the threshold is still at $600, which is the threshold specified by law.

For the last several years, IRS has made an announcement about this in late November or December. We won't know when or if they are going to announce another delay until they do it.

[lux.ra_14]

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@marin-hpd wrote:

https://www.ebay.com/help/selling/fees-credits-invoices/ebay-form-1099k?id=4794&external=1

Why does this form say $600 for 2024?

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The link actually says $5,000* for 2024, with the asterisk denoting last year's transitional "plan" for the 1099 threshold.

Pending a new announcement, it's best to proceed with the idea that it's the $600 set by federal law -- and/or whatever your state law is. 

[dbfolks166mt]

@239rodney wrote:

I understood the IRS memo for 2024 is $5,000 for Ebay sellers

lacemaker3 

Last year, when the IRS said they would delay the $600 implementation for 2023, they also said they were planning to use $5,000 for 2024.

Since then, the IRS has not announced anything to implement that plan, so at the moment, the "official" word is that the threshold is still at $600, which is the threshold specified by law.

For the last several years, IRS has made an announcement about this in late November or December. We won't know when or if they are going to announce another delay until they do it.

     It is possible that nothing will get done for the 2024 tax year. Issues have been raised about whether the IRS has the authority do anything in 2024 or if they even had the authority to do so in prior years. In addition both the White House and Congress are in a pending transition and/or a lame duck state until January 2025. 

https://www.ntu.org/foundation/detail/congress-must-act-to-rein-in-the-irs-and-untangle-the-1099-k-c...

[tobaccocardyahoo]

@dbfolks166mthas raised the important issue of IRS authority.

Since that plan was voiced the Supreme Court has clarified the limits on what government agencies can do within the limits of our constitution. The law say $600 and does not give the IRS any authority to change the limit.

We can hope that in the process of extending the tax cuts due to expire, the Congress will revisit the $600 limit.

[fern*wood]

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@239rodney wrote:

I understood the IRS memo for 2024 is $5,000 for Ebay sellers

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Unless you are responsible for issuing 1099ks, this really doesn't matter.   I doubt many ebay sellers do, but it will matter to ebay/adyen since they are required to send them out.