APX and Form 1099-K
If you’re a managed payments seller who has more than 200 transactions and generates more than $20,000 in sales in a calendar year, you’ll receive a Form 1099-K from APX. This information will also be reported to the IRS and your state tax authority, where applicable.
Form 1099-K is an IRS tax form that includes the gross amount of all payment-card and third-party-network transactions you received within a calendar year. If you’re a managed payments seller, we’ll mail you a Form 1099-K by January 31st if you exceed both of the following thresholds:
- You received more than $20,000 in gross payments from the sale of your items.
- You had more than 200 payment transactions.
The form we send you will only show payments processed since you became a managed payments seller and includes the gross amount of payment-card and third-party-network transactions, as well as your name, address, and Tax ID.
If PayPal or another authorized payment service also processed any of your APX payments during the calendar year, you should receive a separate form from them if your transactions meet the thresholds outlined above.
Sellers in Massachusetts and Vermont
Massachusetts and Vermont use a threshold of $600 and don’t use a transaction threshold, so if you reside in one of these states, you’ll receive a Form 1099-K if the gross amount of payments you receive equals or exceeds $600, irrespective of the number of payments you receive. We’ll also report this amount to the Massachusetts or Vermont tax authority as applicable. You should also note that your gross payments won’t be reported to the IRS unless you exceed $20,000 in gross payments and have more than 200 transactions.
Form 1099-K and multiple APX accounts
We combine all sales that are associated with the same Tax ID Number. So, if you have multiple APX accounts with sales exceeding the above thresholds when combined, you’ll receive a Form 1099-K for each account, even if one or more of the individual accounts do not exceed the IRS thresholds.
For example, if you received $19,999 in payments on one account and $5 on another, assuming you’ve had more than 200 transactions on all of your accounts, you’ll receive a Form 1099-K for each account—one for the $19,999 and another for the $5.
How to use a Form 1099-K
Form 1099-K includes the gross amount of payments made to you within a calendar year, so refunds, shipping costs, sales tax, etc. aren’t subtracted from the total amount. This means that the amount reported on your Form 1099-K may not be fully reportable on your tax return. You should consult with your tax advisor to determine how best to use the information on your Form 1099-K.
Starting in 2019, any sales tax collected by APX on sales made by you in the various marketplace states will not be on your Form 1099-K. This is because APX automatically collects and remits such sales tax directly to the state (i.e. the sales tax for these states isn’t paid to you).
If you have specific questions about reconciling the amounts on your Form 1099-K, we recommend you speak with a tax professional.