With tax season around the corner, we wanted to make sure you’re prepared.
What’s new:
Due to the recent change in IRS tax reporting rules, for sales after January 1, 2025, Amazon is required to issue a Form 1099-K to all sellers who receive $20000 or more in unadjusted gross sales and the number of transactions exceeds 200.
You will receive an email notification on or before January 31, 2026 when your IRS Form 1099-K is ready for download.
FAQs
What is a Form 1099-K?
Amazon is required to file Form 1099-K each calendar year to report the unadjusted gross amount of all reportable payment transactions, which are defined as payment card transactions or third party network transactions. For more information, visit the IRS website here.
Is the IRS Form 1099-K threshold change specific to Amazon?
No. The One Big Beautiful Bill retroactively reinstated the reporting threshold in effect prior to the passage of the American Rescue Plan Act of 2021 (ARPA) so that third party settlement organizations are not required to file Forms 1099-K unless the gross amount of reportable payment transactions to a payee exceeds $20,000 and the number of transactions exceeds 200.
Thank you,
Amazon Tax Team
The way that is written would mean you would have to meet both requirements of $20K and 200 transactions for it to trigger a 1099-K.
In the past, we thought it was either / or type of trigger … either 20K and/or 200 transactions would trigger 1099-K.
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… at least we can count on our shoe size … it never changes
There is probably a greater chance that someone who sells $50k and does not have 200 transactions is selling personal items at a loss and will simply enter the total from the 1099k on schedule 1 and have not tax liability.
This is not any different from past practices.
The situation in many states with high sales tax and large populations is that Amazon and other reporting organizations will be reporting income with far lower than $20k and 200 transactions.
It is amazing how many of the states who prefer to tax the rich, act in a manner which taxes the poor.
Yes, government is wacko, but like the blind men and the elephant, the incomplete perceptions may lead to distorted conclusions.
It is too bad that Amazon did not state in this notification the fact that residents of states like NY and MA will be receiving 1099Ks on lower amounts. Some folks are going to be surprised if they rely on Amazon for their tax advice.
I suspect that the number of people who are unaware of their state having a lower threshold, but are aware that the federal threshold has changed from last year, is rather small. (in fact, this is the first I’ve heard about the new limit; although it’s not something I care about, as I’m not even close. Much more concerned about the bill’s extra tax on gamblers.)
