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Last January, a lot of small sellers opened their email and found a form called a 1099-K waiting for them. Some of them had only made a few hundred dollars. It was the first tax form many of them had ever received from a selling platform.
This January, most of those same people will get nothing at all.
That sounds like good news. For a certain number of sellers it is going to turn into an expensive misunderstanding instead.
What actually changed
The rule about when a platform has to send you a 1099-K went back to the old, much higher numbers.
Platforms like Etsy, PayPal, Gumroad and Amazon now only have to send one when your payments cross both of these lines in the same year:
- More than $20,000 in gross payments
- More than 200 separate transactions
Both. Not one or the other. A seller with $30,000 across 150 sales does not meet it. Neither does a seller with 400 sales adding up to $9,000.
For the last couple of years those numbers were dramatically lower, which is why so many small sellers suddenly started receiving forms. That period is over.
Check it yourself: the IRS Form 1099-K FAQs. The threshold appears in the section explaining who must file the form, and it is written as a single sentence covering both the dollar amount and the transaction count.
The mistake that is about to be made
Here is the thinking that gets people into trouble.
No form arrived. Nobody told the tax office anything. So there is nothing to report.
That is not how it works, and the IRS states it about as plainly as a government agency ever states anything. On its page for people earning money from small online work, it says you must report that income “even if the income is… not reported on an information return form, like a Form 1099-K, 1099-MISC, 1099-NEC, W-2 or other income statement”.
The form is a courtesy copy. It is a notification, not the thing that creates the obligation. Your income existed the moment the money reached you.
Check it yourself: the IRS Gig Economy Tax Center. The sentence sits near the top, in the part explaining what counts as reportable income.
Why this bites small sellers hardest
A seller doing serious volume has bookkeeping. They know their numbers without waiting for a form.
The person at risk is the one selling a few planners a month. For the last two years, the platform handed them a summary and they used it. They never built the habit of tracking anything themselves, because they never needed to.
Now the summary stops arriving, and the habit was never there.
Where your real numbers live
Every platform you sell through keeps a record you can download, whether or not it sends you a form. You do not need accounting software to find them.
- Etsy: Shop Manager, then Finances, then Monthly Statements. You can download a spreadsheet of every month.
- Amazon KDP: the Reports section, where prior months’ royalties can be exported.
- PayPal: Activity, then Statements, then Custom. You can pull an entire year.
- Gumroad and similar: a sales or payouts export, usually a spreadsheet download.
- Your bank: the deposits themselves, which is the backstop if a platform record disappears.
Pull each one for the year. It takes an afternoon the first time.
The habit that makes next year painless
One spreadsheet. Five columns. Date, platform, gross amount, platform fees, what landed in your account.
On the first weekend of every month, open it and add the previous month from each platform. It takes ten minutes once you know where the reports are. Twelve of those and your year is done before anyone asks you for anything.
Keep the platform’s own downloaded statement in a folder beside it. If a question ever comes up, you are not reconstructing a year from memory. You are opening a folder.
Do not forget the money going out
People track what came in and forget what they spent getting it.
Listing fees. Transaction fees. Your AI subscription. Canva. Your domain and hosting. Stock images. The software you bought for making covers. Advertising, if you ran any.
These are the costs of running the thing, and in most places they reduce what you are taxed on. A seller who tracks income carefully and expenses sloppily ends up paying more than they owe. That is a quieter mistake than the first one, and just as common.
Create a second tab in the same spreadsheet. Date, what it was for, how much. Add to it whenever a receipt arrives.
If you have not tracked anything all year
You are not in trouble. You are behind, which is different.
Block out one afternoon before the end of December. Download every platform statement for the year. Download your PayPal history. Go through your email for receipts from anything you paid for.
Doing it in December while the year is still fresh is far easier than doing it in April while trying to remember what a charge from March was for.
Two honest limits on this article
First, I am not a tax professional and this is not tax advice. It is a heads up about a change and a filing habit worth building. If your numbers are meaningful, pay an accountant for an hour of their time. It is the cheapest hour you will buy all year.
Second, everything above is United States rules. If you sell from somewhere else, the thresholds and forms are different, but the underlying principle travels: your income is your income whether or not a platform sends you a summary of it. Find out what your own country requires, and keep the spreadsheet either way.
The one sentence to remember
A form arriving is not what makes money taxable, and a form not arriving is not what makes it invisible.
Open a spreadsheet this week. Ten minutes a month from here.
