Millions using payment apps could see a new tax form in 2026 if their 2025 goods-and-services payments top $2,500. Act now to keep personal transfers separate and cut error risks before December 31.
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The IRS is phasing in broader reporting. For 2025, many casual sellers will cross the $2,500 line without realizing it, and forms are due to arrive by January 31, 2026. Even below that amount, you might still receive one, so good records and correct tagging matter.
What really triggers the form from payment apps?
Platforms must send a form when goods-and-services payments exceed $2,500 in 2025. Personal money between friends or family is not taxable income, but mis-tagged transfers can be reported anyway. You may also receive a form under the threshold; income is taxable whether a form arrives or not. Keep documentation of dates, amounts, and what was sold.
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Those who tag transactions correctly and keep receipts can offset non-taxable amounts and report losses on personal items sold at a loss. Those who mix personal and sales transfers or ignore identity requests risk 24% backup withholding starting in 2025 if a valid taxpayer ID isn’t provided.
“Don’t ignore the form, even if you receive it in error or don’t owe tax on the amounts shown.” — Erin Collins, National Taxpayer Advocate.
Your three moves to stay on the safe side this year
Use these concrete actions to reduce mistakes and headaches:
| Step | Detail | Deadline |
|---|---|---|
| Tag transfers | Mark personal money as non-business; mark sales as goods/services; add clear notes | Now |
| Provide your TIN | Update profile to prevent 24% backup withholding on reportable payments | Before first sale |
| Track basis & fees | Save purchase receipts, shipping, and refunds to offset gross amounts | Ongoing, monthly |
| Reconcile totals | Match app totals to your records; prepare for forms due by Jan 31, 2026 | By Jan 31, 2026 |
What to expect by late January and during filing
Forms should arrive by January 31, 2026. If a form includes personal or incorrect amounts, you can adjust on your return using the IRS’s new reporting space for non-taxable and loss transactions. Keep copies of receipts and messages that show item costs, refunds, and non-business transfers. If backup withholding occurred, it appears on tax forms and can be credited when you file.
Independent contractors: Keep track of your Form 1099-K for accurate tax filing. Find out what you need to know: https://t.co/ulS10jCr40 #IRS
— IRS Small Biz (@IRSsmallbiz) March 6, 2025
SOURCES
https://www.irs.gov/businesses/understanding-your-form-1099-k
https://www.irs.gov/instructions/i1099gi
Jessica Morrison is a seasoned entertainment writer with over a decade of experience covering television, film, and pop culture. After earning a degree in journalism from New York University, she worked as a freelance writer for various entertainment magazines before joining red94.net. Her expertise lies in analyzing television series, from groundbreaking dramas to light-hearted comedies, and she often provides in-depth reviews and industry insights. Outside of writing, Jessica is an avid film buff and enjoys discovering new indie movies at local festivals.