Better Education Will Help Taxpayers Understand Telltale 1099-Ks

After a brief attempt to lower the 1099-K reporting threshold to a mere $600, the IRS recently reverted to the existing $20,000 limit for the current tax year. The agency indicates it will reduce the threshold to $5,000 in 2024.

The proposed $600 threshold triggered widespread uproar. This, and the IRS’s concern that a wave of unexpected 1099-K forms will cause taxpayer confusion and an administrative backlog, shouldn’t drive the agency to postpone the change and gradually lower the threshold.

The chosen approach of delaying and slowly implementing the threshold changes won’t effectively address the issue of confused taxpayers—it simply ...