eBay will no longer mail sellers IRS Form 1099K, which it is required to also send to the IRS showing the gross amount of sellers’ revenue generated on its platform if it reaches a certain threshold.
eBay announced on Thursday that it was automatically changing sellers’ account settings to receive Form 1099-K to electronic delivery (no doubt an effort to save itself money).
While some sellers may prefer email notifications, others who prefer paper may miss the notification given the volume of email they receive (and skepticism over spoof email). It’s especially concerning given the fact the government lowered the threshold, resulting in many sellers being due to receive the form for the first time in 2025 for tax-year 2024.
Sellers can override eBay’s change by updating their delivery preference to receive a paper form, but they should not do so until November 1, 2024 – and they must do so by December 31, 2024, at the latest.
eBay explains Form 1099K on this page of its website but lists the 2024 threshold at $600. While that may be true for residents in some states, the IRS announced in late 2023 that it was phasing in the new amount and said the threshold for tax year 2024 would be $5,000.
In addition to no longer mailing 1099K forms to sellers, the “eBay and Form 1099-K” page currently lists the IRS minimum reporting threshholds for 2024 as being $600 for one or more transactions.
https://www.ebay.com/help/selling/fees-credits-invoices/ebay-form-1099k?id=4794&st=3&pos=1&query=eBay%20and%20Form%201099-K&intent=1099k&lucenceai=lucenceai&docId=HELP1463
The reported amount on an eBay generated 1099-K form includes the gross funds processed by eBay, but not necessarily what was received by sellers.
Sales tax, canceled transactions, and unfullfilled and undisbursed eBay Money Back Guarantee transactions are not reported.
As eBay will issue the 1099-K with the information that was provided when a seller registered their account, one needs to make sure that the name on the account matches the name on a seller’s Tax ID and Federal income tax return.
Because they are currently unaware of the existence of the 1099-K, I fear there are going to be an awful lot of small time sellers who unwittingly fail to report the gross amount that has been reported to the IRS and/or may require the assistance of an accountant or a tax advisor in order to comply with the existing requirements.