Credit Card News
Advertising Disclosure
Credit-Land.com is an independent, advertising-supported web site. Credit-Land.com receives compensation from many credit card issuers whose offers appear on our site. Compensation from our advertising partners impacts how and where their products appear on our site, including, for example, the order in which they may appear within review lists. Credit-Land.com has not reviewed all available credit card offers in the marketplace.
Credit Card Applications » News » Other » IRS Introduces New Tax Form

IRS Introduces New Tax Form

By
Add to Favorites:
IRS Introduces New Tax Form

Now that the holiday season is over, it`s tax season! And the IRS is introducing a new form this year – the federal form 1099-K. Otherwise known as the Merchant Card and Third Party Network Payments form, the 1099-K will be sent out early to applicable recipients. They are scheduled to be in the hands of merchants no later than January 3. All electronically-filed 1099-K`s are due to the IRS on April 2 and paper filings are due by February 28.

This being the first year of the 1099-K there is likely to be a fair amount of confusion. Therefore the IRS is set to delay all penalty provisions in addition to withholding requirements until the first of January, 2013 for all entities obliged to issue the forms. However, the reporting is moving forward.

Here is how things ought to go: certain payments received by merchants via credit card or third party merchants will be reported using the new 1099-K form to the IRS. The types of payment transactions that must be reported using 1099-K are transactions in which a payment card – such as a gift card, credit card or debit card – is accepted as a means of payment or any transaction that uses and is settled by a third party network – such as PayPal. Transactions that are NOT included are credit card cash advances, ATM withdrawals, checks issued in connections with payments cards or any such transaction in which a payment card is accepted by a merchant or other payee as a payment and who is related to the card issuer – such a bill payment.

What this means for taxpayers in plain English is that anyone who has a PayPal account, credit card merchant account or meets the criteria otherwise will be receiving form 1099-K from their service provider. Recipients will include professionals such as architects or lawyers or doctors who accept credit card or online payments for their services, freelancers who are compensated via their PayPal account, eBay merchants, etsy sellers, affiliates and other small businesses that accept PayPal, debit card or credit card payments in exchange for their goods.

However, not every single dollar will be counted. IRS reporting is only required when the total amount of gross payment to an individual payee is over $20,000 for the year and when the total amount of transactions with the participating payee exceeds 200. This means that individuals occasionally selling odds and ends over the Internet will not likely have to grapple with a 1099-K. However, proprietors of successful online stores has better get ready.

Add to Favorites:

Related News:

Amex Acquisition Increases Security

By Dar Dowling, Posted: December 9, 2016

American Express has bought InAuth, Inc., a company specializing in providing customers with mobile device authentication and intelligence solutions. Continue reading
Citi Card Tracker Unveiled

By Dar Dowling, Posted: December 8, 2016

There is a new feature in town now that Citi credit cardholders in the U.S. can track where their replacement card is every step of the way as it travels to their mailbox. This new feature is available in the Citi Mobile App, whether the ... Continue reading
New Digital Wallet From SDCCU

By Dar Dowling, Posted: December 7, 2016

The San Diego County Credit Union (SDCCU) is rolling out their brand new digital wallet app for iPhone users. With the app people can use their phone to safely do their banking, whether that means using their phones to expedite cash ... Continue reading
Get the latest news, articles and expert advice delivered to your inbox. It's FREE.
Get 0% Intro APR on Balance Transfers and Purchases for 21 months. After that, the APR will be 12.24%-22.24% based upon your creditworthiness.
For Excellent/Good Credit
Earn 1% cash back on gas and grocery purchases. Terms apply.
For Fair Credit
Guaranteed $500 Unsecured Credit Limit
For Bad Credit