A law passed last year lowered the reporting threshold for gig workers and others who receive certain types of payments from $20,000 to $600. According to taxpayer groups and lawmakers, that change has harmed both taxpayers and the IRS. The reduced threshold may result in a deluge of Forms 1099-K from confused online sellers being dumped on the IRS. The National Taxpayer Advocate recently explained that innocent transactions such as splitting a dinner charge on a platform such as Venmo could trigger 1099-K notices. Democratic lawmakers have introduced a bill that sets the taxable floor at $5,000, retroactive to Jan. 1, 2022. Contact us if you’re unsure whether you need to file Form 1099-K.
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