Invoices & Tax Forms
1099-K Form (US)
Polar will issue 1099-K forms via Stripe to eligible users in the US on an annual basis.
For tax year 2023, 1099-K forms are required for users who received:
- $20,000 in gross volume (USD)
- Over 200 transactions
IRS has expressed intent to lower the threshold to be equilivant to other 1099 forms, e.g NEC, at $600. However, it's still being discussed and is not guaranteed for 2024 and onward. Stripe keeps the thresholds up-to-date based on the requirements and their developments.
Why not a 1099-NEC or 1099-MISC?
TurboTax has this great article on the difference between 1099-K, 1099-NEC & 1099-MISC
If you’re self-employed and accept credit, debit, or prepaid cards, you may receive Form 1099-K for transactions processed by a third party. This includes creators, influencers, rideshare drivers, or side-giggers. If you’re an online seller selling on platforms like Ebay, AirBnB, Etsy, and VRBO, you may also receive Form 1099-K.
Stripe further clarifies 1099-K requirements for Payment Settlement Entities (PSE) in this article.
Effectively, 1099-K is required for platforms/marketplaces which:
- Handles payment between someone providing goods/services to purchasers
- Such payments are made with credit, debit, or prepaid cards.
- Receiver is not a contractor/freelancer to the platform/marketplace
Polar meets all of these criterias and therefore issues 1099-K forms to eligible developers on the platform vs. other forms.