IRS announces delay for implementation of $600 reporting threshold for third-party payment platforms

Justin_2
Visitor
1 0 0

So why did I get a 1099-K Form?? I have made much less then $20,000 and less then 200 transactions. The new $600 rule will only be implemented NEXT year. Why did Shopify send me a 1099-K form??

 

Anyone have any idea? Thank you. 

 

https://www.irs.gov/newsroom/irs-announces-delay-for-implementation-of-600-reporting-threshold-for-t...

 

Reply 1 (1)

Kimi
Shopify Staff
1511 169 260

Hi, @Justin_2.

 

Like you mentioned, the federal threshold set by the IRS is indeed $20,000 processing volume and 200 transactions. Both these metrics have to be met in order for a store to qualify. In saying this, some states have lower thresholds, as listed on the table below. Keep in mind that your state is determined by the address listed on your Shopify Payments account, which is separate from and may or may not be the same as the store address in your Shopify admin settings.

 

State Name 2022 Threshold 
Arkansas
>= $2,500 USD in gross payments within the calendar year, no transaction threshold.
California
Follows the federal threshold, with one exception. California has a threshold of $600, but that only applies to 'app-based drivers' (e.g. Uber). Shopify merchants are not likely to qualify for this category.
District of Columbia (DC)
>= $600 USD in gross payments within the calendar year, no transaction threshold.
Illinois
>= $1,000 USD in gross payments and 4 transactions within the calendar year.
Maryland
>= $600 USD in gross payments within the calendar year, no transaction threshold.
Massachusetts
>= $600 USD in gross payments within the calendar year, no transaction threshold.
Missouri
>= $1,200 USD in gross payments within the calendar year, no transaction threshold.
New Jersey  >= $1,000 USD in gross payments within the calendar year, no transaction threshold.
Vermont >= $600 USD in gross payments within the calendar year, no transaction threshold.
Virginia
>= $600 USD in gross payments within the calendar year, no transaction threshold.

 

Is your business based in one of the states mentioned above? 

 

If not, we can reach out to our internal taxes team to double check your store's eligibility for the 1099-K form. We can't do this via the Community Forums however, due to security and privacy reasons. So your next step here is to get in touch with our support team via our Help Center here. Once logged in, select a topic that best fits your query or situation. From there, you'll be taken to a page with a list of relevant support articles, and you can scroll to the bottom of that page to select your preferred contact method with our team. Our live support team can further assist from there and, if required, they can reach out to our taxes team on your behalf.

Kimi | Social Care @ Shopify 
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