The American Rescue Plan Act of 2021 lowered the threshold for reporting on Form 1099-K, Payment Card and Third-Party Network Transactions. This form is used to report payments:
- From payment card transactions (e.g., debit, credit, or stored-value cards), and/or
- In settlement of third-party payment network transactions above the minimum reporting thresholds.
For returns for calendar years after 2021, payors must report gross payments that exceed $600 and any number of transactions. This is quite a step down from the prior requirement for payors to report gross payments that exceed $20,000 and more than 200 such transactions. Now, a third-party settlement organization must report any information concerning third party network transactions of any participating payee only if the gross amount of total reportable payment transactions exceeds $600 for the calendar year, regardless of the number of transactions.
Also, it is worth noting that the Form 1099-K (Rev. January 2022) is now a continuous use form.
Check out the Form 1099-K and Instructions, both revised in January 2022, here:
https://www.irs.gov/pub/irs-pdf/f1099k.pdf
https://www.irs.gov/instructions/i1099k
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