Congress reduced the tax reporting threshold to $600 from $20,000 in 2021, and it was slated to affect people filing tax returns in the spring of next year.
The IRS said it will use the coming year to transition to the new requirement and that more information would be available soon.
“The additional time will help reduce confusion during the upcoming 2023 tax filing season and provide more time for taxpayers to prepare and understand the new reporting requirements,” Acting IRS Commissioner Douglas O’Donnell said in a statement Friday. The requirement for third-party payment processors to send 1099-K forms to taxpayers with more than $600 in business transactions, with no minimum number of transactions required, was included in the 2021 pandemic aid legislation known as the American Rescue Plan Act. Previously the law had the higher dollar threshold as well as a minimum of more than 200 transactions.
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