Form 1099-K, Payment Card and Third Party Network Transactions
What is Form 1099-K?
Form 1099-K was introduced in 2011 and is used to report income that you received from credit cards, debit cards, or other electronic payments such as Google Checkout and PayPal.
Initially, the IRS indicated that it would require businesses, including any taxpayers running small businesses (selling goods on eBay and Amazon for example), to reconcile any differences between the amounts reported on their returns, and the amounts reported on Form 1099-K, starting with 2012 returns. More recently however, the IRS has announced that businesses would not be required to show a reconciliation on their tax returns -- and that they did not intend to require a reconciliation on future returns.
Despite this change in the IRS position, you should note that the IRS is establishing a compliance program using the data collected with Form 1099-K. This program will include notices to business taxpayers to validate the quality of merchant card data received by the IRS. Accordingly, you should retain any 1099-Ks you receive for your records in case you are contacted by the IRS.
Note: If you have a Schedule K-1 (not the Form 1099-K), see Enter Schedule K-1 Information.
Entering 1099-K into TurboTax
Don't worry! When you use TurboTax to file your return, we will ask you about any eletronic payments you might have received. We'll enter them on the right form and perform all the calculations for you.
If you've already gone through the step-by-step interview and want to jump directly to the entry screen for this topic, follow these directions. Do be aware that 1099-K income is not entered separately, but gets reported in the appropriate income section.
- Select the Federal Taxes tab (the Business tab in the Home & Business edition).
- Select the Wages & Income subtab.
- Scroll down the Wages & Income screen until you see the Other Common Income group.
- Click on the Start/Update button to the right of the Income from Form 1099-K category.
- Follow the prompts.
If you have yet to receive your 1099-K, please click here to explore your options.
If you need to correct or change any information you have entered from your 1099-K, the steps you take depends on if you have already filed your tax return.
- If you have yet to file your return, simply follow the navigation instructions above, and correct or change your information.
- If you have already filed your return, you will need to amend your return. Please click here for instructions.
For questions about printing, please click here.
If you have questions about the availability of form 1099-K, please click here.