IRS Form 1099-K, Payment Card and Third Party Network Transactions, is an information return that reports payments from payment apps or online marketplaces. These entities are also known as third-party settlement organizations (TPSOs) and include PayPal, Venmo and eBay. For 2024, the reporting threshold is $5,000. The IRS recently announced that in 2025, TPSOs must report transactions of $2,500 or more. In 2026, the threshold decreases to $600. The IRS won’t assess a penalty for the failure of a TPSO to withhold and pay backup withholding tax during the 2024 calendar year. However, it will begin assessing penalties in 2025. Contact us for more information.
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