Under OBBBA the Form 1099-K reporting threshold for third-party payment platforms (Stripe, PayPal, Square, marketplaces) reverts to more than $20,000 in gross payments AND more than 200 transactions, restoring the pre-2021 standard. The American Rescue Plan Act's $600 threshold, and the phased $2,500/$5,000 interim steps, are repealed. The IRS updated its 1099-K FAQs on October 23, 2025.
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IRS 1099-K threshold reverts to $20,000 and 200 transactions; the $600 rule is repealed
Why this matters for founders
Marketplaces and platforms must issue far fewer 1099-Ks and should update payout reporting logic accordingly. Note: recipients still owe tax on all income whether or not a form is issued, and some states keep lower thresholds, so keep clean internal payment records.
Source: IRS — Form 1099-K FAQs: General information
MarketplaceE-commerce / RetailFintechConsumer AppSaaS / Software #form-1099-k#obbba#compliance#taxes#operations#marketplace
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