Obtain your 1099 from PayPal

Find your 1099 on Paypal

1. Log into Paypal

2. Navigate to Settings

3. Click Statements and Taxes 

4. Check if your 2023 tax form is available under Tax Documents.

Frequently Asked Questions

Why do we recieve the 1099 from Paypal and not one from Drip?

• • Since all payouts are processed through the third party provider Paypal, they are responsible for reporting the information and thus provide the 1099. 

  • Under IRS rules, companies like PayPal, which are considered third-party payment processors, are required to report payments processed for goods and services through their network on Form 1099-K under certain conditions (for example, if the total number of transactions exceeds a specific threshold or if the total payment volume exceeds a certain amount within a calendar year). This is because PayPal directly handles the money transfers, making it responsible for reporting the payments it processes to the IRS.

  • On the other hand, platforms like Drip, which utilize PayPal for handling payments, do not directly process the payment transactions themselves. Instead, they rely on PayPal to manage the flow of funds. Therefore, Drip would not issue a 1099 form for payouts that are processed by PayPal, as they do not have direct visibility or control over those transactions in a manner that would necessitate reporting under IRS regulations.

  • This structure helps streamline tax reporting by ensuring that only the entity directly managing and processing the transactions (in this case, PayPal) reports to the IRS, avoiding duplicate reporting and simplifying the tax filing process for individuals and businesses using these platforms.

What is a Goods and Services payment with PayPal?

• • Both PayPal and Venmo offer a way for customers to tag their peer-to-peer (P2P) transactions as either personal/friends and family or goods and services by choosing the appropriate category for each transaction. Users should select Goods and Services whenever they are sending money to another user to purchase an item, like a couch from a local ad listing or concert tickets, or paying for a service. These transactions are also eligible for coverage under PayPal and Venmo’s Purchase Protection Program. Goods and services payments are designed to provide both buyers and sellers peace of mind knowing that they may be covered if the transaction doesn’t go as expected.

  • You can find out more on PayPal Goods and Services transactions here, and Venmo Goods and Services transactions here. Terms and conditions apply.

Will the updated 1099-K threshold change apply if I sell personal property, like a couch or an item at a garage sale, for $600 USD or more if it was sold for less than its original value? Will I be issued a Form 1099-K?

• • Form 1099-K is an IRS informational tax form that is used to report goods and services payments received by a business or individual in the calendar year. While payment service providers, like PayPal and Venmo, are required by the IRS to send customers a Form-1099K if they meet the $600 USD threshold amount, there are certain amounts included on the form that may not be taxable. PayPal is required to report the total gross amount of payments received for goods and services which can include:
    
    

    • Amounts from selling personal items at a loss

      1. Refunded amounts

      2. Processing fees

  • However, certain amounts may not be considered taxable income to you. We encourage customers to speak with a tax professional when reviewing their 1099-Ks to determine whether specific amounts are classified as taxable income.
    
    

What is Form 1099-K?

• • Form 1099-K is an IRS informational tax form used to report payments received by a business or individual for the sale of goods and services that were paid via a third-party network, often referred to as a TPSO or credit/debit card transaction. The IRS requires TPSOs, such as PayPal and Venmo, to issue a Form 1099-K, which shows the total amount of payments received from a TPSO in the calendar year. Taxpayers should consider this amount with their tax advisor when calculating gross receipts for their income tax return.  For more information, visit the IRS website here.

  • If you meet the IRS threshold in a given calendar year, PayPal will send you a Form 1099-K in January of the following year and file this form with the IRS by the required due date.

  • You can access your Form 1099-K from your PayPal account from January 31 and your Crypto gains and loss statement from February 15. Please go to the new PayPal Statements & Tax Center. Merchants, please go to your Tax Statement Page.

  • You can also view and download your Form 1099-K online by January 31st annually. You won’t receive a Form 1099-K if you didn’t meet the reporting requirement for the tax year.

What do I need to do when the 1099-K threshold change takes effect?

• • PayPal and Venmo will ask customers to provide tax information like an Employer Identification Number (EIN), Individual Tax ID Number (ITIN), or Social Security Number (SSN), if they haven’t already, as they approach the reporting threshold, so they may continue using their account to accept payments for the sale of goods and services without any issues.

    • If your TIN fails verification, you'll need to fill out an equivalent tax form W-9.

    • If there are any discrepancies between what is reported by the IRS for your TIN and name and what PayPal has on file and used for Form 1099-K, you may receive an IRS B-Notice.

How does this 1099-K threshold change impact how I use PayPal?

• • This change should not impact how you use PayPal and Venmo. You can continue to use the PayPal and Venmo platforms as you do right now, and the benefits that are offered by sending money via our goods and services P2P feature – including buyer and seller protections on eligible transactions for PayPal and Venmo.