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I think receive 1099K by mistake? Should I report it?

Forum|Forum|5 years ago
February 19, 2021
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Hello,

I received the 1099K form from Paypal surprisingly. I don't think I should receive it since 1) I have transactions < $20,000, and paid times < 200 which is under the federal threshold. 2) I was living in Wisconsin almost the whole 2020 year. There is no threshold in Wisconsin. 3) I did move to Illinois in mid November 2020. I know Illinois has threshold $1,000. While during the time, I have no transactions. So, I'm super confused why I got the 1099K form. I'm wondering should I report this form to Wisconsin state tax and Illinois state tax, and also IRS (federal)?

Best answer by DaveF1006

Please view this Turbo Tax link, for a solution to this. The answer to your question is yes you need to report it but in the link, there is a workaround to exclude the income. Here is how to report according to Hal_Al, one of our esteemed super users.

"Federal Taxes tab (Personal in Home & Business)
Wages & Income
Scroll down to less Common Income
Misc Income, 1099-A, 1099-C
On the next screen, choose – Other reportable income
On the next screen, click yes
On the next screen, you'll get blanks to enter the amount and a description. It will go on line 8 of Schedule 1 as "Other Income". Suggestion for description: erroneous income on 1099K
When that's done, do it again (a 2nd entry). This time make it a negative entry; put a minus sign (-) in front of the amount. Suggestion for description: erroneous income on 1099K offset."

[Edited 02-18-2021|07:48 PM PST]

DaveF1006

How much is the 1099-K?

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W

wuayqi55Author

It is $ 9,838

DaveF1006Answer

Please view this Turbo Tax link, for a solution to this. The answer to your question is yes you need to report it but in the link, there is a workaround to exclude the income. Here is how to report according to Hal_Al, one of our esteemed super users.

"Federal Taxes tab (Personal in Home & Business)
Wages & Income
Scroll down to less Common Income
Misc Income, 1099-A, 1099-C
On the next screen, choose – Other reportable income
On the next screen, click yes
On the next screen, you'll get blanks to enter the amount and a description. It will go on line 8 of Schedule 1 as "Other Income". Suggestion for description: erroneous income on 1099K
When that's done, do it again (a 2nd entry). This time make it a negative entry; put a minus sign (-) in front of the amount. Suggestion for description: erroneous income on 1099K offset."