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IRS Announces $5,000 1099-K Reporting Threshold for Tax Year 2024
The Internal Revenue Service (IRS) recently announced that for the 2024 tax year, the 1099-K reporting threshold will remain at $5,000. This means that business owners will receive a Form 1099-K if they: 1) exceed the 2024 reporting threshold of $5,000 in sales, 2) had Federal and/or State backup withholding applied in 2024, or 3) are residents of states that have a lower reporting threshold.
For upcoming tax years, the IRS has announced that those thresholds will decrease in tax years 2025 and 2025, business will be required to report transactions when gross sales are more than $5,000 in 2024; more than $2,500 in 2025; and more than $600 in 2026 and beyond.
This delay is an important step for small businesses, however, our advocacy continues. We believe a higher reporting threshold is necessary and will continue to work with Congressional leaders in the Senate and House to advance a permanent high threshold. During the 118th, the NASE supported several bills in the House and Senate that would raise the reporting threshold, we will continue this advocacy in the 119th.