IRS Says “No More Surprises” on 1099-K Thresholds —Here’s What That Means for You
If you’ve been wondering whether your Etsy shop, coaching payments, or digital product sales will trigger a 1099-K this year, the IRS just cleared things up. In a new FAQ released this fall, they confirmed that the threshold for 1099-K reporting will stay at $20,000 and 200 transactions for 2025.
That’s a big relief for small business owners and gig workers who were bracing for a lower threshold.
What’s a 1099-K?
It’s a form issued by payment processors (like PayPal, Stripe, or Square) to report income received through their platforms. If you hit the threshold, you’ll get one automatically—and the IRS will too.
What Changed?
Originally, the IRS planned to drop the threshold to $600. But after pushback from small business advocates, they’ve delayed that change again. For now:
• You’ll only get a 1099-K if you earn $20,000+ and have 200+ transactions
• This applies to goods and services, not personal reimbursements or gifts
What You Should Do
• Track your income manually—don’t rely solely on forms
• Separate business and personal transactions in your payment apps
• Educate your audience if they’re confused about what counts
This is a great time to share a simple guide or checklist with your community. Help them feel confident, not confused.
Source: IRS 1099-K FAQs – IR-2025-107
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CompliantHer™ program of (Relannford Enterprises LLC) is not a law firm. This document is intended for educational and informational purposes only and does not provide medical, legal, or financial advice. If you have questions about your specific situation, please consult a physician, attorney, or accountant licensed to practice in your state and/or country.
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