For tax season 2023, you will receive a 1099-K tax form if you sell $20,000 or more in goods or services, with a minimum of 200 debit, credit or PSE platform transactions. These are the same 1099-K thresholds as the 2021 season. No changes to worry about!
But starting in 2023, all that will change. Anyone who receives only $600 from selling goods or services from third-party payment platforms or online services will receive a 1099-K—and there’s no more transactions minimum! These will be massive changes for your side hustle taxes.
Looking ahead (because everyone knows time flies), let’s say you meet the $600 threshold for sales made using a third-party payment network in 2023. Then you would keep an eye open for a 1099-K in the mail starting in January 2024. Remember, even if you only received a single $715 payment via paypal for your one closet listing in 2023, you can expect to receive a 1099-K.
You can see all earnings inside your Closet Dashboard if your 1099-K has any discrepencies.
