NASE Calls Decision “A Major Victory for Small Businesses Engaging in the Online Marketplace”
As a major advocate for bipartisan legislation in Congress to relieve the burden of a new law requiring 1099-K reporting requirements for small businesses and solo-entrepreneurs engaging in the online marketplace, the National Association for the Self-Employed (NASE) celebrated the announcement by the Internal Revenue Service (IRS) delaying the reporting requirement for third-party platform payments for the 2023 tax returns.
During this legislative session, NASE came out strongly in support of two pieces of bipartisan legislation related to the 1099-K reporting requirement. NASE has long expressed concern with increased thresholds, lowering both the dollar value and eliminating the threshold number. For many entrepreneurs who operated in the vintage or re-sale space, this is not only burdensome but potentially confusing and could serve as a deterrent for these entrepreneurs.
“The decision by the IRS to delay tax reporting requirements for online, third-party platforms for 2023 is a major victory for small businesses engaging in the online marketplace. As a major advocate for bipartisan legislation in Congress to ease the burden of these reporting requirements, today’s IRS announcement is a huge sigh of relief for millions of small businesses and solo entrepreneurs,” said Keith Hall, president and CEO of National Association for the Self-Employed (NASE), the nation’s leading advocate and resource for the self-employed and micro-businesses. “We are thrilled that so many U.S. taxpayers and entrepreneurs made their voices heard. We are committed to being a strong voice for them in Congress and will continue advocating for a bipartisan legislative solution that is fair to the millions of American small businesses engaging in the online marketplace.”
According to the announcement by the IRS: “As the IRS continues to work to implement the new law, the agency will treat 2023 as an additional transition year. This will reduce the potential confusion caused by the distribution of an estimated 44 million Forms 1099-K sent to many taxpayers who wouldn’t expect one and may not have a tax obligation. As a result, reporting will not be required unless the taxpayer receives over $20,000 and has more than 200 transactions in 2023.”
“This year-long delay will allow us the opportunity to work with lawmakers and regulators to ensure the voice of the American small business community is heard in the crafting of a fair, equitable way forward. Furthermore, it will provide our community with the necessary time to become educated about any new reporting requirement and compliance guidelines to avoid problems and confusion for small business taxpayers,” concluded Hall.
