Don’t File Your Taxes Early Says IRS, Wait for Form 1099-K
Once you’ve received your W-2 from your primary job, you might be tempted to file your taxes as soon as the filing window opens to get your refund sooner.
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Typically, the IRS begins accepting tax returns in mid-to-late January for the prior year. For instance, last year, tax season for 2021 began on January 24, 2022.
But you may want to wait to file this year, according to tax experts and the IRS. More taxpayers could receive a form 1099-K reflecting income from third-party payment network transactions this year.
In other words, if you received money from gig work, the sale of goods and services, or other payments not processed as “friends and family” through Venmo, Zelle, or PayPal, you may receive a 1099-K form reflecting this income.
Third-party payment processors do not have to mail out 1099-K forms until January 31, 2022. You should wait until late February or early March to be sure you’ve received the appropriate 1099-K forms in the mail before filing, tax experts told CNBC.
If you don’t wait to receive your 1099-K form and file your taxes, you could owe taxes on income received. If you receive a 1099-K after you file your taxes, you will need to complete an amended tax return.
For 2022, anyone who earned just $600 in aggregate through a third-party payment network will receive a 1099-K form. The old threshold, prior to 2022, was more than $20,000 in income over 200 or more transactions. This money does not include payments processed from “friends and family.”
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If you received a 1099-K for income you didn’t earn, you should call the payment provider, according to the IRS. The IRS cannot fix the error. If you received funds for “goods and services” that should have been processed as a payment from “friends and family,” you may have to pay taxes on that money.
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This article originally appeared on GOBankingRates.com: Don’t File Your Taxes Early Says IRS, Wait for Form 1099-K
