PROTECTING SMALL BUSINESS, PROMOTING ENTREPRENEURSHIP

SBE Council Responds to IRS Delay of 1099-K Reporting Threshold for 2023

By at 21 November, 2023, 5:47 pm

NEWS

For Immediate Release

Washington, D.C. – Small Business & Entrepreneurship Council (SBE Council) president & CEO Karen Kerrigan issued the following response to an announcement by the Internal Revenue Service (IRS) today that the agency will again delay implementation of the lower threshold for 1099-K reporting (which went from $20,000 to $600 in the American Rescue Plan) for the 2023 tax year.

“The IRS was wise to make this decision given the potential for massive taxpayer confusion and the general lack of awareness and clarity on the new 1099-K threshold. At least 44 million new forms were expected to flood into the mailboxes of unsuspecting citizens who sell used items online, for example, and many taxpayers receiving these forms would not be required to do anything. But how are they supposed to know that? The absurdity of the new reporting threshold has created a massive make-work scheme for payment apps and online marketplaces. It has generated significant waste and depleted resources within both the private sector and at the IRS.

“Congress and President Biden need to be advancing policies that make things simpler, more efficient, and less costly. The new threshold requirement does exactly the opposite. While we are pleased that the IRS has once again delayed implementation of the new threshold, Congress should repeal this intrusive reporting scheme by passing the Stop the Nosy Obsession with Online Payments Act (SNOOP Act) either separately or as advanced by the House Ways and Means Committee in a broader tax relief and reform package this past June.”

In its announcement today, the IRS stated that it will phase in the reporting requirement, and is planning for a $5,000 threshold for tax year 2024 and will eventually get to the $600 reporting threshold enacted under the American Rescue Plan (ARP).

CONTACT:

KAREN KERRIGAN, kkerrigan@sbecouncil.org

SBE Council is a nonpartisan advocacy, research and education organization dedicated to protecting small business and promoting entrepreneurship. For nearly 30 years, SBE Council has worked on and advanced a range of private sector and public policy initiatives to strengthen the ecosystem for strong startup activity and small business growth.

Visit www.sbecouncil.org for additional information. Twitter: @SBECouncil

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