What Do I Need to Know About My 1099-K Tax Form?

Quick answer

US sellers who reach more than $600 in gross sales in 2022 will receive a 1099-K form from Etsy. Be sure your taxpayer details are up to date, especially if you expect to reach at least $500 in sales, when you’ll be required to have a taxpayer ID on file. Learn how to update your taxpayer information.

Eligible sellers will be able to download their 1099-K form by the end of January, 2023.

If you’re a US seller, and reach more than $600 USD in gross sales in 2022, Etsy will provide you with a 1099-K form you can use when filing your 2022 taxes.

Receiving a 1099-K form doesn’t necessarily mean you’ll owe taxes on your Etsy sales. The 1099-K form we issue doesn’t calculate your profit or indicate any tax liabilities you may have—it simply gives the total gross sales processed by Etsy Payments in 2022. Learn how the 1099-K form from Etsy is calculated.

If you don’t have a valid Social Security Number, Individual Taxpayer Identification Number, or Employer Identification Number on file with your Etsy shop, Etsy will alert you via email and in your Shop Manager as you approach the IRS sales threshold. Once your 2022 sales reach $500, you must update your taxpayer details.

If you don’t have valid taxpayer details on file and exceed $500 in sales, your shop will be suspended until you add these details. Your taxpayer ID on file ensures we can give you and the IRS your 1099-K form as required by US law. 

As much as we’d like to make taxes as easy as possible for sellers, Etsy’s not in a position to interpret tax laws and give specific tax advice. That’s better left to authorized professionals. Please reach out to a local tax professional if you need tax advice.

To be sure the information on your 1099-K is correct, check that you’ve entered a valid SSN, ITIN, or EIN, matching taxpayer name, and mailing address on your Legal and tax information page.

Learn how to update your taxpayer information

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What is a 1099-K form?

A 1099-K form is used to report your gross sales to the IRS as part of filing your taxes. “Gross sales” includes all of your sales – including shipping, refunds, card processing fees, sales tax applied using the sales tax tool, and even canceled orders. Learn how the 1099-K form from Etsy is calculated.

A 1099-K form from Etsy reports the total gross sales income you received through Etsy Payments from January 1 to December 31 in a given year.

You may already be familiar with a W-2 form. If you’ve worked as an hourly or salaried employee for a business in the US, that business likely issued you a W-2 form at the beginning of a new year for you to use when filing your taxes. A 1099-K form is similar, but instead of listing wages for a consistent hourly or salary pay, it lists your sales via transactions processed by a third party payment service like Etsy.

Learn about more about the different income forms for tax filing on the IRS website.

A blank 1099-K form with spaces for your name, address, taxpayer ID number, gross sales, number of transactions, gross sales for each month, and federal and state income tax withheld.

Why am I receiving a 1099-K this year?

In 2022, US lawmakers significantly lowered the sales threshold for who must receive a 1099-K form. In previous years, Etsy sent sellers a 1099-K if they earned at least $20,000 or there were at least 200 transactions on Etsy during the year. However, for 2022, sales only have to reach $600 for the seller to receive a form, and there is no longer a threshold for a number of transactions. This means many Etsy sellers who’ve never received a 1099-K will receive one this tax season.

We need your taxpayer ID to complete our legal obligation of sending you and the IRS your 1099-K if you meet the $600 sales threshold. Etsy will email you to ask for your taxpayer ID when you reach $250 and then $500 in sales and don’t have a taxpayer ID (SSN or EIN) on file.

I’m not a US-based seller. Does this apply to me?

If you’re not a US seller, you won’t receive a 1099-K from Etsy. However, if the information on your Legal and tax information page identifies you as a US seller (your address on file is US or you receive payments in USD), we’re required to issue you a 1099-K form. To remove yourself or your business from this filing obligation, we’ll need a completed W-8BEN form.

To start the W-8 form request, contact Etsy support. You’ll get an email from Track1099 (no-reply@track1099.com) on behalf of Etsy with the Form W-8BEN request. To prevent the email from going to your junk or spam folder, add no-reply@track1099.com to your contacts.

Do I have to use the 1099-K for my state taxes as well?

You may have to use your 1099-K from Etsy for filing your state taxes. Some US states have their own 1099-K sales thresholds, while others may require Etsy to send them a copy of the federal 1099-K form issued. You can use the same 1099-K form for filing your state taxes.

Alabama

$1500

Arkansas

$2500

California

$600

District of Columbia

$600

Illinois

$1,000 and 4 transactions

Maryland

$600

Massachusetts

$600

Mississippi

$600

Missouri

$600

New Jersey

$1000

Vermont

$600

Virginia

$600

What if I have more than one Etsy shop?

If you run multiple shops, the sales across all your shops will be combined based on your SSN/EIN number. If the sales across your shops total more than $600, you’ll receive a single 1099-K form for your combined gross income from all your shops.

For Individuals and Sole Proprietorships

To ensure the information on your 1099-K form is correct, please review and update all of your shops’ information as needed. The same combined 1099-K form will be available for download in all your shops.

Etsy requires using the same taxpayer information (Name, Address, and SSN/EIN) on each of your shops’ Legal and tax information pages. This will ensure the totals reported on your form are accurate and will help expedite any other form updates needed.

How do I download my 1099-K form?

If you’re eligible to receive a 1099-K form, you can download your 1099-K form in your Legal and tax information. It will appear here by the end of January, 2023.

  1. On Etsy.com, sign in and go to Shop Manager.
  2. Go to Finances.
  3. Go to Legal and tax information.
  4. Select Download 1099-K. Your e-form will download as a PDF file. Don’t leave the page until the download is complete.

Can I choose to have a paper 1099-K form mailed to me?

You can choose to have a paper 1099-K form mailed to you by opting out of paperless-only delivery by December 31, 2022. You won’t receive a 1099-K form in the mail unless you’ve opted out by December 31.

  1. On Etsy.com, sign in and go to Shop Manager.
  2. Go to Finances.
  3. Go to Legal and tax information.
  4. Under 1099-K Settings, toggle Off to opt out of paperless-only delivery. 

How do I update the taxpayer information on my digital 1099-K form?

If your taxpayer information is incorrect on your digital 1099-K form, you can update your taxpayer ID to receive an updated form on or before March 14, 2023. As of March 15, 2023, Etsy will no longer accept changes to 2022 tax information. If you update your 2022 taxpayer information between January, 2023 and March 14, 2023, you can download an updated form as follows in the table below:

If you update your 2022 taxpayer information by: Expect your downloadable 1099-K form to be updated no later then:
February 13, 2023 February 28, 2023 *
March 14, 2023 March 27, 2023

*Date subject to change. Communications will be sent to sellers if dates change.

Learn more about updating your taxpayer information.

In the meantime, you can view your gross Etsy Payments sales totals on the Legal and tax information page for each of your shops.

Can I file my taxes online?

Online services like Turbotax, H&R Block, TaxAct, and IRS Free File provide free or affordable ways to prepare and file your taxes online. With TurboTax Self-Employed, you can choose an option that offers unlimited expert advice, and as an Etsy seller, you can get at least 25% off the usual price. (Paid partnership. Terms apply.)

IRS Free File is a guided tax preparation program that provides tax help for people under a certain income level at no cost to you (you must be filing as an individual).

The IRS also has an Interactive Tax Assistant with a confidential search field you can use to find answers about your filing status, potential deductions, and other questions.

What Can Etsy Support Help With?

Etsy Support can help you with any of the following issues:

  • You need to correct taxpayer information on your form (before March 14 deadline). Learn how to update your taxpayer information.
  • You’re concerned about the gross amount reported on your form. Learn how the form is calculated.
  • You have a technical issue downloading the 1099-K form
  • You need to download your shop data (CSV files) to reconcile the gross total.
  • You don’t know where to find certain data (e.g., certain fees, refunds, etc.)
  • You should be exempt from needing a 1099-K form as an eligible individual or business outside the US

A tax professional, and not Etsy Support, can help with these topics:

  • State specific thresholds and reporting requirements
  • What to do if you’re having trouble updating your taxpayer information with the IRS
  • How to file taxes with  your 1099-K form if it needs to be split between two different taxpayer numbers in a single calendar year 
  • Which countries you’ll have to report earnings to
  • What exactly you’ll need to report and how to report it on your tax return
  • The tax implications of changing locations and filing status (individual vs. business)
  • How to report expenses on your tax filing to ensure you only pay taxes on your net profit
  • Details about the $600 IRS reporting threshold for 2022 and how it may impact your tax filings
  • What to do if your 1099-K form is incorrect for a previous tax year

US sellers, be sure your taxpayer details are up to date in your shop, especially if you expect to reach at least $500 in sales in 2022. Learn how to update your taxpayer details.

In 2022, Etsy is required to issue a 1099-K form to you and the IRS if your shop reaches $600 USD in sales during the calendar year. Etsy will email you when you reach $250 and $500 in sales and don’t have a taxpayer ID (SSN or EIN) on file.

Once your 2022 sales reach $500, you must have valid taxpayer details on file. If you don’t have valid taxpayer details on file and exceed $500 in sales, your shop will be suspended until you add these details. Update your taxpayer details on your Legal and tax information page.

Are you getting an error when entering your EIN information? If you recently received your EIN from the IRS, your EIN information is not registered in the IRS database yet. For now, add your SSN and wait a few weeks to re-enter your EIN information.

For 2022, the US government significantly lowered the threshold for who must be issued a 1099-K form, meaning many more Etsy sellers will receive a form for 2022 than in prior years.

If your shop reaches $600 USD in sales during 2022, Etsy is required to issue a 1099-K form to you and the IRS.

To ensure we can fulfill our legal obligations, we ask that you add your taxpayer ID when you reach $500 in sales, if you don’t have your taxpayer ID on file yet.

In 2021, the prior thresholds for issuing a 1099-K were:

  • You had $20,000 USD in sales through Etsy Payments during the calendar year.
  • You received 200 or more transactions through Etsy Payments over that same period.

If you run multiple shops as the sole proprietor, the sales across all your shops will be combined to determine whether you have met the reporting thresholds. If the names and addresses on your Etsy shops don’t match, we’ll use the name and address from your oldest shop that has your SSN/EIN on it. 

If your combined shop totals qualify, you will receive a separate 1099-K for each shop.

Your 1099-K total is your gross sales income. To reconcile your 1099-K form, you can download your Etsy Payments CSV file and view the “gross” column.

Your total gross sales income from Etsy Payments is reported on the 1099-K form without subtracting expenses, such as (not a complete list):

  • Fees
  • Refunds
  • Shipping costs
  • Sales tax collected by you

While we are required to report gross income on your form, it remains your responsibility to determine what, from your total amount earned, to report as taxable income on your income tax return. You pay taxes only on your profit (in other words, gross sales minus expenses and deductions). 

Taxes collected by Etsy from your buyers are not reported on the 1099-K form we issue.

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