Form 1099-K is defined as the Payment Card and Third Party Network Transactions form which is an IRS information return used to report transactions.
The IRS requires all payment processors in the United States to provide information to them for customers who meet specific criteria. Everyone who received a payment for goods and services over $20,000 through a third-party payment network, such as Hemlane, within 200 or more transactions will have their income reported on a 1099-K form.
Hemlane uses Stripe, a payment processor, to process all payments which is why any of our users who meet the IRS’ criteria will receive a 1099-K form.
FAQ - 1099-K Form
What is a 1099-K tax form?
A 1099-K form is a tax form used to report payments for goods and services transactions through a third-party payment network. Organizations that facilitate these payments are required by law to file them with the IRS and send copies to the payment recipient.
Will I receive a 1099-K form?
You will only receive a 1099-K form if you received any payments of at least $600 through Hemlane.
As a property manager or owner, if you have received one or more payments of any kind through Hemlane which total $20,000 or more over 200 or more transactions, you will receive a 1099-K.
If you have not acquired a total of $20,000 through 200 or more transactions on Hemlane, you will not receive a 1099-K form no matter if you are an owner, team member, or tenant.
Why didn’t I receive a 1099-K form last tax season?
A 1099-K form was only sent to those who met the criteria of receiving 200+ transactions and $20,000+ through a third-party payment network. If you did not meet this criteria in or before 2021, you would not have received a 1099-K form.
How will I receive my 1099-K form?
We'll notify you by email to the address on file with your Hemlane account when your tax documents are created.
Why is my payment through Hemlane considered a good or service?
Since Hemlane is a software as a service (SaaS) product, all payment transactions made within Hemlane including card transactions (debit card, credit card, stored-value cards) as well as any network transactions (such as ACH payments) are considered a service provided by us and our third party payment processor, Stripe.
Please note, even though these transactions within Hemlane are considered a service, it is likely you won’t have to pay taxes on them. Hemlane is simply required to report these transactions to the IRS for any Hemlane account which processes $600 or more.
When do I need to confirm my tax information?
You will need to report your earnings for 2022 during the 2023 tax season. To ensure Hemlane is able to issue your 1099-K in time, we’ll need your tax info confirmed by January 6th, 2022.
You will want to confirm that you have the following information updated and on file with Hemlane:
- a valid SSN or EIN matching your taxpayer name
- your taxpayer name (such as your LLC)
- your mailing address within your Hemlane account
Confirming your tax information early ensures that we’ll have everything our teams need to issue your 1099-K form in a timely manner.
What happens after I confirm my tax info?
If you meet the requirements, we’ll issue you a 1099-K form at the beginning of the 2023 tax season and send a copy to the IRS.
(This information is not intended to be and should not be construed as tax advice. You should consult your tax advisor regarding your reporting of these transactions.)
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