Wrong issued 1099 K on my name. Not on LLC

[quickstorevegas]

Got wrong issued 1099 K on my name. Not on my LLC. Nothing was changed last 3 years in account. Customer Service Representative  said that it was bug. But no timeframe when it gonna be fixed. AMAZING. I'm requesting URGENT manually correction ! 

[wastingtime101]

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@beautifuljewelrynyc wrote:

eBay agent worked with me, on 1st day added my account to technical issue list, 2nd day downgrade my business type to Sole Proprietor (from Sole Proprietor/Single-member), 3rd day upgrade to Corporation (from Sole Proprietor).  The agent walked me through the steps when I input information. And I need to upload my photo ID again after each step finished.

The setting updates will cause another problem “month limits” going down significantly (Mine from a few thousand quantity items down to 500 items.). The system will automatically end listings instead of relist them. I contacted eBay and explained to them that I had business type updated. eBay gave me back selling quantity/  increased my selling limits.

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When you made this change @beautifuljewelrynyc, did you get any confirmation from eBay on how this will affect everything?

Is the 2022 form 1099 going to be reissued or do you have to deal with it as-is, issued to your SSN and work with your CPA/IRS on how to file?

Is the 2023 form 1099 going entirely to your EIN even though the change occurred partway into this year, so the full year didn't have you down as a corporation? They're not going to do some kind of split where they give you a 1099 against your SSN for the first 5 weeks of 2023 then give you a second 1099 against your EIN for the rest of the year, right?

It sounds to me like corporations receiving 1099s to their SSNs is because they're mis-classified on eBay's backend so each affected account needs to contact eBay to fix that to avoid a repeat of this problem for 2023 form 1099. 

I can't believe with all these inquiries eBay clammed up and provided zero guidance - hasn't even come to this forum to let us know corporations will need to work with CS as you did to re-classify their accounts. They basically dismissed the entire situation as a non-issue.

[beautifuljewelrynyc]

Yesterday, I received confirmation from the same eBay agent (who helped me to correct my business type from Sole Proprietor/Single-member  LLC to Corporation) that eBay approved the request to revise my 1099K  of 2022 from my name/SSN to company name/EIN. The revision will be ready in 4 business days. 

I am happy eBay finally agreed to correct my 1099K. Before I didn’t change my business, I had called eBay a few times and talked to different people in eBay tax department, they refused to correct my 1099K. Some agents told me to get business type be corrected to Corporation for future correct 1099K issuing, and leave the 2022 one as it is.

During the process to change my business type, I also noticed, under the current eBay business type setting, Sole Proprietor and Single-member LLC are separated to two business types, not like the original version with a slash between them and served as ONE business type(Sole Proprietor/Single-member LLC).  (There are 4 business types under current setting version: 1. Sole Proprietor   2. Single-member LLC   3. Corporation/Multi-member LLC  4. None profit. ) . I saw some sellers said they have a few accounts (LLC taxed as S corporation), for some accounts, eBay issued 1099K to personal name/SSN, while for other accounts, 1099K issued to company name/EIN. It is so strange.

[newmiker]

any update?   Below was info from official website if 1099k received showing personal name. Can eBay help us?

Scenario:  Report business income on Form 1120, 1120S or 1065 and you receive a Form 1099-K in your name

Action(s) to take:

If you report your business income on a Form 1120, 1120S or 1065 and you receive a Form 1099-K in your name as an individual (showing your social security number), contact the PSE listed on the Form 1099-K to request a corrected Form 1099-K showing the business's TIN. In addition, request that the PSE use the business's TIN on all future Forms 1099-K. Report the income from the Form 1099-K along with any other sources of income on the appropriate income tax return. Retain all correspondence with the PSE to show that this error was corrected.

[rarevisionbooks]

No update here either. Was told on Jan 30, 2023, 10-12 business days for corrected 1099k. Would also please request ebay support to let us know how to proceed. Cannot use current 1099k. This makes no sense that we get no response here.

[hero_collect]

@rarevisionbooks 

I am a LLC, that has been elected as an S corp in 2020. I was also taxed under my SS because Ebay never provided me an option to change from Single Member to Corporation. 

Try calling cs again.  After my 4th attempt contacting them.  A Ebay cs rep told me to send in a w-9 with my updated information. I dont want to put their specific email in here yet because I am still submitting the information. I will update soon. 

Try calling them again and asking if you can submit a w-9 and if they can update your information.  They will provide you a specific email + subject line.

[newmiker]

so you will change the business type from single LLC to corp though you are a single member llc. then you will be taxed as crop under EIN.  Did they say that they will correct the current 1099?  and how about the next year' 1099? two 1099s, one under ssn before correction and one under ein after correction?

[quickstorevegas]

So, what you guys with tax as S-Corp will do ? Still nothing from eBay. 

[vinascrystals]

I chatted again with an eBay support agent and she took all my information and said she will pass this to the tax department. That was last week and haven't heard since. I am not hopeful they will fix it. 

As to avoid triggering an audit, apparently most accountants do is to file a schedule C on the owner's personal return and then "nominee" the entire amount to the EIN, recording it as an expense line item. 

So for example:

SCHEDULE C INCOME: 500,000

EXPENSE LINE ITEM 1. -  500,000 NOMINEE INCOME TO EIN XX-XXXXXX

This workaround is not endorsed in writing by IRS so we still have the risk that their machines might flag the personal return for audit so eBay has to fix this. 

[wastingtime101]

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@quickstorevegas wrote:

So, what you guys with tax as S-Corp will do ? Still nothing from eBay. 

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Hey @quickstorevegas - read the last few posts from @beautifuljewelrynyc as they worked this out with eBay and shared steps on what they did.

[newmiker]

Hello @wastingtime101.  @beautifuljewelrynyc is different case. He/She has an INC, but accidently used sole/single LLC when he set up accounts, so ebay will correct it for sure. 

[rarevisionbooks]

When I reached out in chat again today the rep told me because I was an sole/single LLC they would not change the 1099k for 2022 (even though in 2021 they used my business name/ein on 1099k). She said my request was denied 3 times, even though I only talked to them once by chat on 1/30/23 other than today. She told me to go to the settings and change my business type for 2023. I said there wasn't that option so was directed to screenshot what I was trying to do and email the images to them. She said "Our internal team will review and update it for you if they can :)"

Hopefully they can, because if they can't who can?? And that would only be for 2023 and forward, and maybe a partial year depending on how long this takes them.

Has anyone else having any luck in getting this sorted?

[quickstorevegas]

Tried to change business information too. No option from Sole/Single LLC owner 

[beautifuljewelrynyc]

On W-9 form, Federal tax classification has more options than on eBay’s setting. Try to contact eBay again to see if can re-submit a correction request and send them W9 (the form can download on IRS website).

[hero_collect]

Currently there is two problems on my account:

1. I do not have the choice to change from sole/single member llc to a corporation. (it just doesnt give me the option to change)

2. My 1099-k is under my name and ss not my business and ein.

Contact them again, and ask to be transfered to someone in the tax department.

I was ask to send in a W-9 form from the IRS. I called again a few days later and (luckily) I was talking to somebody in the tax department. 

She assure me tha it will fix it but it will take about 5-7 business days. 

Make sure you contact them ASAP, our filing time is running shorter each day. 

[beautifuljewelrynyc]

If the correction request was submitted earlier, while the W-9 was sent a few days later, need to make sure the correction request is still valid/not denied already when sending out the W-9. eBay denies a request in about 3 days. Need to re-submit the request. 

After receiving both the correction request and W-9, in about 3 days, eBay tax team will send a confirmation email.

Correction request and W-9 form better to be submitted at same time.