Online sellers, we warned you about this in 2010. The Internal Revenue Service created the new 1099-K form as a way to keep closer tabs on those who sell items online, and the 2011 tax year is the first in which the form will apply.
Cash Money Life gives you the rundown on the form, which Amazon, PayPal and other services that deal with financial transactions will issue to customers.
You’ll only receive a 1099-K if you’ve participated in 200 transactions adding up to $20,000. It’s the IRS’s helpful way of reminding you to report income you might have otherwise overlooked. If you don’t receive a 1099-K because sell less frequently, you’ll still have to report your income.
Are You Ready for the New 1099-K? [Cash Money Life]