On October 23, 2022, the IRS announced a delay in new reporting thresholds for third-party settlement organizations that was set to take effect for the 2022 tax year. Due to the delay, settlement organizations will not be required to report transactions on Form 1099-K for the $600 lower threshold amount enacted as part of the American Rescue Plan of 2021.

The previous threshold, which will remain in effect, requires the issuance of a 1099-K for more than 200 transactions per year, exceeding an aggregate amount of $20,000.

The IRS has said this additional time will be used as a transition period for implementing the lower threshold reporting requirements. The revised transition timeline can be found in Notice 2023-10 which can be found here:

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https://www.irs.gov/pub/irs-drop/n-2023-10.pdf

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