Do you use Venmo, CashApp, Paypal, etc?

The IRS calls these third-party settlement organizations (TPSOs).

American Rescue Plan Act of 2021 mandated that any TPSO showing transactions more than $600 must send a

Form 1099-K to the customer. However, on November 26, 2024, the IRS announced that TPSOs will be required to report transactions when the amount of total payments for those transactions is more than $5,000 in 2024; more than $2,500 in 2025; and more than $600 in calendar year 2026 and after.

Furthermore, TPSOs that have performed backup withholding for a payee during calendar year 2024 must file a

Form 945 and a Form 1099-K with the IRS and furnish a copy to the payee.

Actions to Take: Upon receiving a 1099-K, promptly upload it to the portal at hometownaccountant.clientportal.com. Subsequently, collect your statements from the TPSO to differentiate between income and reimbursements from friends or family.

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Shelley H. Morales is your Hometown Accountant!

Give me a call today to find out how you can leave the books to me & have more of your time free! 352-358-1413 info@hometownaccountant.com www.hometownaccountant.com/book-online/