Accepting credit cards for payment processing requires additional IRS reporting in the form of a 1099-K — a tax form presented to the IRS and used to report your processing volume.
Gravity Payments is required to report to the IRS the volume in payments processed by businesses each year.
You should receive Form 1099-K by January 31st if, in the prior calendar year, you received payments:
- From payment card transactions (e.g., debit, credit, or stored-value cards), and/or
- In settlement of third-party payment network transactions above the minimum reporting thresholds as follows:
- For returns for calendar years prior to 2022:
- Gross payments that exceed $20,000, AND
- More than 200 such transactions
- For returns for calendar years after 2021:
- Gross payments that exceed $600, AND
- Any number of transactions
- For returns for calendar years prior to 2022:
Note: For transactions made after March 11, 2021, The American Rescue Plan Act of 2021 clarifies Form 1099-K reporting by third-party settlement organizations applies only for transactions for the provision of goods or services settled through a third-party payment network.
Click this link to learn more about Form 1099-K and its instructions on the IRS website.