March is upon us, and with it comes many things, including March Madness, St. Patrick’s Day, and, depending on where you live, early signs of Spring. But March is also important for U.S. businesses and individuals as it’s the last full month before U.S. income tax returns are due on April 15.
Consequently, many of you are already working on your 2012 tax returns or will be soon. For many of you, that means receiving a 1099 form from eBay to incorporate into your returns. 1099 forms are important entries in tax returns since companies use these forms to report to the IRS (and to you) how much money you made in 2012. Some of you have been asking questions about 1099s, so to help clarify we thought it might be worthwhile to take a moment and share with you some basics about 1099 forms and tax filing responsibilities.
Fact #1: How you have chosen to receive payment from ePN determines (1) which part of eBay Inc. provides your 1099 form, and (2) the type of 1099 form you receive. If you’ve chosen to be paid via direct deposit and are above the dollar threshold (more on that below), ePN is responsible for providing you with a 1099-MISC form. 1099-MISC forms for 2012 were mailed to publishers in January of this year. However, if you are paid via PayPal, and are above the dollar threshold, then PayPal is responsible for providing you with a 1099-K form. 1099-K forms are available for download on www.paypal.com in your Tax Documents area by following these instructions: 1) Log in to your PayPal account 2) from the History tab, select Tax Documents 3) Select the tax year for which you need documentation, and click Submit.
Fact #2: Your choice of payment method dramatically changes the thresholds that determine whether or not you receive a 1099 form. If you are paid via direct deposit, ePN must provide a 1099-MISC form if you’ve been paid at least $600 in 2012. By contrast, if you’re paid via PayPal, an altogether different IRS threshold applies. The IRS requires companies like PayPal that process credit and debit card transactions to provide 1099-K forms to those who have received at least 200 separate payments equal or greater than $20,000 in value. Publishers who don’t meet both of these thresholds for 2012 will not be issued a 1099 form.
If you have further questions on this topic, you can still contact the entity that would provide your 1099 forms: ePN Customer Support (submit a Contact Us form, or email firstname.lastname@example.org) or PayPal Customer Support (click on https://www.paypal.com/us/webapps/helpcenter/home/ or call (888) 221-1161). Additionally, more information about 1099s can be found on the IRS web site, www.irs.gov.
Remember, regardless of whether you receive a 1099 form or not, publishers have a duty to report their correct income to the IRS. Although we at eBay cannot offer tax advice, we are happy to help explain the reporting rules and smooth the process wherever possible.