Tracking business income through third-party payors

If you receive business income payments through third-party payors, 2022 might be a game changer for your taxes. If these payments total at least $600 for the year, payors such as Zelle and Venmo are now required to file a Form 1099-K with the IRS. Previously, the threshold was $20,000. Some members of Congress want to raise it but for now, you must prepare to have income reported to the IRS that may not have been reported in the past. To minimize the tax consequences, be ready to substantiate all business expenses. Track your business miles (actual costs or 58.5 cents per mile in 2022) and calculate the percentage of your phone bill that applies to your business. Need help? Contact us.

Posted May 12, 2022