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E-file Form 1099-K Online with Tax2efile

Filing Form 1099-K online is not a daunting task when you register with Tax2efile. Our platform offers a seamless e-filing experience that saves money and time. Our secure platform provides you with comprehensive guidance about online filing and ensures compliance with the IRS. Tax filing is often confusing, and if you are not sure which 1099 Form applies to your business, then it is even more complicated. Tax2efile makes it easy for you to choose which forms you need to file with its user-friendly guidance.

What is Form 1099-K

What is Form 1099-K?

Form 1099 K is used by the Payment Settlement Entities (PSEs) to report third-party payment network transaction transactions and payment card transactions for a tax calendar year. If you own a small business and accept online credit card payments, you need to pay particular attention to the IRS 1099-K Form. In our changing world, this newest tax document represents a shift towards online commerce and credit card payments, and there is a lot of confusion about who needs to file and what to do if you receive one.

The 1099-K Form exists due to the 2008 Housing Assistance Tax Act. While it has nothing to do with housing, this form was created to hold online retailers responsible for reporting sales for tax purposes. Credit card companies and third-party processors like PayPal and Amazon are all required to report payment transactions on behalf of retailers. If you accept credit card payments or run an e-commerce business through a third-party processor, you may find a 1099-K Form in the mail. On the 1099-K you will find listed the gross payment card and third-party network transaction amounts. Both are required by law to be reported to the IRS and Form 1099-K is one of many documents that are designed to ensure that self-employed persons report their earnings accurately.

Learn More About Form 1099-K

How to File Form 1099-K Online?

Previously, the income reported on a 1099-K Tax Form was reported on your 1099-MISC and they were not considered different documents. However, after 2008, the two have become separate. Now, the 1099-MISC Form is usually used for payments made to independent contractors and self-employed persons, and the 1099-K Form is used to accurately report how much money you made from card transactions online. You can file through the FIRE (Filing Information Returns Electronically System). If a payment entity has more than 250 individual returns to file in any given tax year, they must all be electronically submitted. Payee statements are due the March 31st of every year. If a payee has given consent, they may receive their documents electronically, although it is standard to mail a paper copy for their records.

The quickest and easiest way to E-file 1099 taxes is to use Tax2efile.Our service provides an easy way to file with flexibility that customers can take advantage of. If you are unable to file on your own or need a little extra help when filing, it is best that you contact a qualified tax preparer who can help you get your documents filed correctly and accurately. Filing your taxes inaccurately can cause future problems for the payer if they aren’t done correctly the first time.

If you are a business owner that accepts credit card payments or works through a third-party processor, then the 1099-K Form is the most important form that you should be filing for. If you simply use a card to make online purchases, then this form isn’t for you.

Form 1099-K Boxes Explained

Accurate reporting starts with understanding each box on the Form 1099-K

  • Box 1a Gross amount of payment card/third-party network transactions: The total dollar value of payment card or third-party network transactions that must be reported based on the calendar year for that payee.
  • Box 1b Card Not Present transactions: Similar to Box 1, but the data refers to the transactions where the card was not physically present.
  • Box 2 Merchant Category Code (MCC): Describes the type of business or service that you offer.
  • Box 3 Number of Payment Transactions: Report the number of transactions that were carried out within the fiscal year.
  • Box 4 Federal Income Tax Withheld: Indicates any backup withholding that has been applied to the account.
  • Box 5a to 5l Monthly Transaction Breakdown: Some forms have a monthly summary to make it easier to reconcile income.
  • Boxes 6, 7, 8 State Tax Information: It displays the amount of state income tax withheld and the state ID number, if available.
How to File IRS Form 1099-K

Watch our step-by-step video on How to E-File IRS Form 1099-K with Tax2efile

Watch our step-by-step video on How to E-File IRS Form 1099-K with Tax2efile

Learn more

Who Must File Form 1099-K?

Every PSE or other party which submits instructions to transfer funds to the account of a participating payee, in the settlement of reportable payment transactions, must file an information return (Form 1099-K) with respect to each participating payee for that calendar year.

Multiple PSEs. If two or more persons qualify as PSEs for the same reportable transaction, the PSE that submits the instruction to transfer funds must file the return. However, the PSE obligated to file may designate another person to file the return, including the PSE not making payment, if the parties agree in writing. If the designated person fails to timely file the return, the entity with the responsibility to file is liable for any applicable penalties under sections 6721 and 6722

Electronic payment facilitator (EPF). If a PSE contracts with an EPF or other third party to make payments in settlement of reportable payment transactions on behalf of the PSE, the facilitator or other third party must file Form 1099-K in lieu of the PSE.

Important update

For calendar years after 2021, the minimum reporting threshold for gross payments in the settlement of third-party payment network transactions will be $600 for any number of transactions.

If filing for calendar years prior to 2023 the minimum reporting threshold for gross payments is $20,000 and more than 200 of such transactions.

When is the Due Date to File Form 1099-K?

Form 1099-K deadline to the IRS is on February 28th for payments reporting through their third-party work transactions and credit card payments. If you are filing electronically, the due date will be March 31st.

Filing Type Deadline
Recipient copy January 31st
IRS Paper Filing February 28th
IRS Electronic Filing March 31st

Note: If the due date/deadline falls on a Saturday, Sunday, or federal holiday, the filer will need to E-file 1099 on the next business day.

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Frequently Ask Questions

Find answers to commonly asked questions about our products and services.

Form 1099- K is filed for gross amount of all reportable payment transactions. You will receive a Form 1099-K from each payment settlement entity from which you received payments in settlement of reportable payment transactions

Anybody who accepts payments from credit cards or third-party payment networks such as PayPal or Venmo might receive a 1099-K

Details that are required to file Form 1099-K are: Names, Address, Tins, gross amounts of payment card/third party network transactions, Card Not Present transactions, Merchant category code, Number of payment transactions, Federal income tax withheld.

Yes, Tax2efile offers a bulk upload feature that allows the user to upload all the Payees to an excel sheet for a faster process.

Yes, Tax2efile offers printing and mailing service! Our dedicated team will print and mail out each form you filed.

Form 1099-K is generally used for transactions made through payment cards and third-party networks. However, it may not be applicable to all types of business transactions.

Form 1099-K reports transactions made through payment card transactions (e.g., credit cards) and third-party network transactions (e.g., PayPal, Stripe) that exceed the de minimis threshold set by the IRS.

The de minimis threshold is the minimum amount of gross payments a taxpayer must reach in a calendar year before they are required to report on Form 1099-K. Check the IRS guidelines for the most current threshold.

If you believe you should have received a Form 1099-K but did not, contact the payer promptly to ensure you have the necessary information for your tax return.

Yes, if you discover errors on a previously filed Form 1099-K, you can file an amended return. Make sure to follow the IRS guidelines for filing corrections.

Using our fast electronic service, you can complete your filing within 5 minutes.

Tax2efile allows you to correct a mistake to the recipient’s information for TINs, Names & amounts.

To file Form 1099-K for a single return the filing fee is $3.25.

The IRS requires Form 1099-K to be submitted by February 28 through the mail and by March 31 if you file the form electronically however, recipients’ copy should be mailed by January 31.

Failure to file the 1099 form by the deadline may result in IRS penalties. The penalty can be from $60 per 1099 Form, the maximum penalty can be up to $630,500. If you submit Form more than 31 days to before August 1, the penalty increases to $120 per 1099 Form and maximum penalty up to $1,891,500. If you file after August 1, the penalty can be from $310 per 1099 Form and maximum penalty up to $3,783,000. Additionally, there are penalties for failure to furnish the payee statement.

If you notice discrepancies, review your transaction records and contact the payer for clarification. It’s essential to resolve any discrepancies before filing your tax return.

Form 1099-K typically reports transactions involving payment card transactions (such as credit cards and debit cards) and third-party network transactions (transactions processed by companies like PayPal, Venmo, etc.).

No, transactions made with cash or check are not typically reported on Form 1099-K. This form is specifically for electronic transactions processed through payment cards or third-party networks.

Yes, Tax2efile implements various security measures to protect sensitive information, including encryption protocols, secure data storage practices, and compliance with industry standards for data protection.

If you were expecting a Form 1099-K but did not receive it, you should contact the payer to request a copy. If you still do not receive it, you should report the income on your tax return based on your own records.

Still have questions?

If you have more questions, please refer to our FAQ page. Contact our customer support team for assistance.

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