1099-K for 2023

[hiv801]

I received my 2023 1099-K via email from Ebay. My 2023 sales were just over $5,000 in 2023. I am aware that the IRS threshold is $600 for 2023. So why did I get the 1099-K? Or is Ebay just sending them to everyone. Please reassure me that I don't need to do anything with it for 2023. Just want to make sure I can ignore it.

[wastingtime101]

You're in New Jersey which has a state threshold of $1,000.00 for 1099-Ks.

You can't ignore reporting your income to the IRS & the state of NJ.

[stainlessenginecovers]

You CANNOT ignore it!!

Copy went to your state and IRS; so you need to 'report' that amount on your taxes (along with any other $$ you had). You can possibly 'write off' shipping, ebay fees, original cost of item (if you have receipts) etc. 

Talk to your Tax Preparer and 'bring that' with you!! 

On a side note- you said you did $5000 and threshold is $600 so not sure why you think you wouldn't 'get one'...but

The IRS suspended the $600 thing again this year, so 1099's were issues for those with minimum $20,000 and 200 transactions UNLESS

You are in a state that requires a 1099 issued over $600, $1000, $1500 (just google your state as there are a FEW that require 'reporting' (and again, they will get a copy, so be sure your 'returns' are accurate if you don't want trouble. 

[kensgiftshop]

I think New Jerseys limit is $1000 to receive a 1099K.

[monica-sells]

You should not ignore it....

Based on what you sell, how you source it, and what you spend to fulfill your your orders,

you must include that 'somewhere' on your tax returns...

chances are you can mitigate any sales proceeds with expenses or other deductions....

short of checking with a reputable accountant, you can check various legit sources online as to how to treat your sales.....

[caldreamer]

IRS requires that you report "all income" whether you get 1099 or not.   When you file your income taxes you need to to report "gross sales" (as shown on 1099).   When you file taxes as a "business" you can deduct "business expenses" (EBAY fees, shipping expense, cost of goods sold, mileage, packing material, office supplies, etc).  

EBAY has "easy to read" 1-page report that shows YTD totals for (orders, refunds, EBAY fees, shipping expense).    Go to Payments, Reports, REPORTS (NEW) and select LAST YEAR.

You need to keep receipts for other miscellaneous expenses (packing materials, office supplies, mileage, etc).   You need to create Excel spreadsheet for your inventory showing "cost of goods/description/date listed/date sold) and assign Inventory# to all your listed items.  You use the same Excel spreadsheet forever (just keep "subtracting" when item sell and "adding" when  you list new merchandise".

If you never filed "business taxes" before I strongly urge you have CPA do them.   You need provide accountant with 1099, also EBAY 1-page report (showing EBAY fees, returns, shipping expense) and miscellaneous expenses.  Also you are required to provide your  BEGINNING INVENTORY ON HAND (cost of goods) JANUARY 1 and ENDING INVENTORY ON HAND December 31.   You can get this info from the Excel spreadsheet that you created showing "cost of goods" for all INVENTORY (sold, refunded, added).

[niftyfindsinphoenix]

Hey man we have to report our 1099ks to the irs. if you do not well problems will occur. just a thought of doing business.

[mam98031]

@hiv801 

I am unsure as to why some think if they don't get a 1099K they don't have to report the income earned on the internet.  This way of thinking would mean for 2023 if you paid $19,999 on Ebay you would not need to report that income since the threshold on the 1099K for 2023 is $20,000 and 200 transactions.

It is surprising but some do think this way as I've personally had conversations with several sellers that thought this.  And there is likely many more that feel this way which would be why the threshold was lowered [however delayed one more year].

Ask people that think this way if someone that gets a W2 that is $19,999 or less, do you think they don't have to claim their income?  Or they get a 1099-Misc or any other type of IRS form.  Well of course they don't think so, but for some reason they hold the 1099K to different standards.  IDK why as they have never been different.

The 1099K is merely a form, like a 1099-INT, a 1099-NEC, a 1099-Misc or any of the other types of 1099 FORMS.  None of which set the threshold for all income that has to be reported.

IRS does not have a minimum requirement to report income.  In the rules for Self Employment taxes it says there is a minimum of $400 worth of income before the SE taxes kick in.