2022 changes to eBay and your 1099-K
Important information about how this change in legislation will impact you
Here’s what you need to know
- Starting on Jan 1, 2022, eBay and other marketplaces are required by the IRS to issue a Form 1099-K for all sellers who receive $600 or more in sales.
- The new tax reporting requirement will impact your 2022 sales and taxes that you file in 2023—it will not apply to your 2021 sales and taxes that you file in 2022. Throughout 2022, look for updates from us that will help explain what’s changed and what you need to do next.
- If you haven’t already given us your Social Security number (SSN) or Individual Tax Identification Number (ITIN), we’ll ask you to provide it once you reach $600 in sales.
- No need to worry— you only pay taxes on profits. You won’t owe any taxes on something you sell for less than what you paid for it. For example, if you bought a bike for $1,000 last year and then sold it on eBay today for $700, that $700 you made would generally not be subject to income tax.
- While eBay is unable to give tax advice to our sellers, we want to help make dealing with taxes as easy as possible. Our goal is to help all sellers, casual or those selling as a business, with these new requirements.
Form 1099-K thresholds for your 2021 sales
For the tax year 2021, you may have recently received a Form 1099-K for selling more than $20,000 and 200 transactions.
Some states have lower reporting thresholds for 2021. Check with your state’s tax or revenue department to confirm the 1099-K threshold.
Here’s how you can help
We’re lobbying Congress on your behalf to raise the $600 threshold. Help us stop overtaxation and the avoidable disclosure of private information.
You can share your story about the importance of online selling, or send a letter to members of Congress.
Frequently asked questions
Form 1099-K basics
What is a 1099-K?
Form 1099-K is a document that taxpayers receive to report income from payment card and third party network transactions. It includes the gross amount of all payment transactions within a calendar year. This gross amount doesn’t include any adjustments for credits, discounts, fees, refunds or other amounts. We’ll send you a 1099-K if you sell $600 or more.
Why do I need a 1099-K?
Your sales on online marketplaces like eBay are considered reportable income once they are over a certain amount. Because eBay processes payments for these sales, IRS regulations require us to issue a 1099-K for US sellers who sell $600 or more. When calculating your taxable income for your income tax return, you should consider the amounts shown on your 1099-K.
What does a Form 1099-K include?
Starting Jan 1, 2022, a Form 1099-K includes your total sales amount for all your selling transactions for the year, if your total sales are $600 or more.
Taxes that eBay collects from your buyers are not reported on the Form 1099-K. Also not included are adjustments for:
- Selling fees paid to eBay
- Any refunds
- Sales tax collected by you
The reported amount on your Form 1099-K is different from the sum total of payments you received from eBay (which may include the adjustments listed above). We encourage you to contact a tax professional if you have any tax questions.
When can I expect to receive a 1099-K?
Will I have to pay taxes if I receive a 1099-K?
Not necessarily. Just because you receive a 1099-K doesn’t automatically mean that you’ll owe taxes on the amount reported on it. The 1099-K shows your gross receipts, but you are taxed on your net income.
Only goods that are sold for a profit are considered taxable, so you won’t owe any taxes on something you sell for less than what you paid for it. For example, if you bought a bike for $1,000 last year and then sold it on eBay today for $700, that $700 you made would generally not be subject to income tax.
Please consult a tax professional if you have any questions about any tax filing or regulations.
What happens if I have multiple accounts?
If you have multiple eBay accounts associated with the same SSN or ITIN, your thresholds are calculated by combining all payment transactions for the year. If your combined sales exceed the above thresholds, you’ll receive a 1099-K for each account, even if one or more of the individual accounts does not exceed the IRS reporting thresholds.
Where can I find more information about 1099-K?
Here are some general IRS FAQs on this topic.
Changes for you in 2022
What are the Federal requirements for 1099-Ks in 2022?
As of Jan 1, 2022, the IRS requires eBay to provide you with a Form 1099-K if you receive $600 or more in sales during the 2022 tax year. Keep this in mind when preparing your tax filings related to the 2022 tax year. We’ll provide this form to you in early 2023. This information will also be reported to the IRS, as required by law.
Do states have different requirements for Form 1099-K reporting?
Some states have lower reporting thresholds for 2021. It might be a good idea to check with your state's tax or revenue department to confirm the 1099-K threshold for your state.
Who do these new 1099-K changes affect?
This legislation affects all sellers whose sales total $600 or more in 2022. Sales in 2021 aren’t affected.
You should expect to receive a 1099-K if your total sales reach $600. There’s no minimum amount of transactions. The law applies to sellers that are US citizens or US residents.
I received payments in 2021 from PayPal as well as eBay Payments. Who will provide a Form 1099-K to me?
eBay will calculate the reporting threshold only for the payments you received from eBay Payments and we will send you a Form 1099-K if you exceed the 2021 reporting threshold with eBay payments. PayPal will calculate the reporting threshold separately.
Does this 1099-K change only apply to eBay?
No, IRS regulations require all businesses that process payments, including online marketplaces like eBay, to issue a Form 1099-K for all sellers who sell $600 or more.
What do I need to do for the new 1099-K changes?
If you haven’t already given us your 9-digit Social Security number (SSN) or Individual Tax Identification Number (ITIN), we’ll ask you to provide it once you reach $600 in sales. eBay requires this to be compliant with required laws related to 1099-K. If you don’t provide your TIN, your payouts may be put on hold and we may deduct backup withholding from future payouts.
For everything you sell online in 2022, it's helpful to keep a record of your costs, item purchase prices, and any selling related expenses.
In January 2023, eBay will send you a 1099-K form for your 2022 sales. It will include information on your eBay sales in 2022, and you can use it to determine your income from online selling. This information will also be reported to the IRS, as required by law.
What bookkeeping software can I use with eBay?
Quickbooks is fully integrated with eBay. You can automatically sync your eBay transactions, see breakdown of income, sales tax and fees for each eBay transaction and keep everything organized in one place. Learn more.
Your personal information and security
Why do I need to provide my full SSN or ITIN?
We’re required by federal law to ask for the full 9-digit SSN or ITIN for each of our primary account holders. The IRS requires this in order to be compliant with the laws related to 1099-K forms. Having accurate information about our customers ensures there are no payout delays.
How does eBay use my private information?
Our goal is to build and maintain a safe and trustworthy community for our customers. To do this, we need accurate information about our customers, including your ITIN or SSN. Learn more about privacy and security in our Privacy Center.
How does eBay keep my information secure?
We’re committed to protecting your personal data with leading edge information privacy and security programs to ensure your data is secure. We also recommend you enable 2-step verification. We’ll give you ongoing visibility into any information we collect and the ability to easily update your preferences at any time. Learn more about our data security in our Security Center.
Why does eBay need to verify my SSN or ITIN?
If you have a seller account, we’ll need your 9-digit SSN or ITIN to make sure your 1099-K is accurate. This helps you avoid any delays when receiving your payouts and for us to comply with tax laws.
How will I know when my SSN or ITIN is verified?
Once your SSN or ITIN is verified, you’ll start receiving your payouts again — as long as there are no other pending account issues.
What if my SSN or ITIN doesn’t pass verification?
If your information doesn’t pass verification, we’ll let you know through My eBay or Seller Hub. You’ll then be prompted to double check:
- Your full 9-digit SSN or ITIN was entered correctly.
- Your name matches your legal name (example: "Mike" vs "Michael") and there are no typos.
If you’re still not passing verification, you can upload a signed Form W-9 instead.
How long will eBay hold my funds if I don’t pass verification?
When your information doesn’t pass verification, you have 180 days to provide us with a Form W-9 or enter your information again. If you’re not passing verification and you’ve double checked your information and found nothing wrong, you can still upload a W-9.
If your information is still not verified after 180 days, we'll begin withholding 24% of your sales as requested by the IRS.
What is a B-notice?
A B-notice is part of the IRS’s Backup Withholding Program. The IRS alerts eBay when a seller’s name and Taxpayer Identification Number (TIN) on their 1099-K do not match what’s in the IRS’s records.
There are two B-notices that eBay sends you. The first is when the IRS first informs us that your TIN is missing or does not match their records.
eBay issues a second B-notice to you after we receive another notice from the IRS within a 3-year period. Under the second B-notice, you'll have to provide validation of your correct legal name and TIN combination in the form of a Social Security card.
eBay sends sellers a B-notice through regular mail. If this information is not corrected, as required by the IRS, sellers will be subject to backup withholding of future payouts.
Why did I receive a B-notice request via mail to submit a W-9?
If you’ve sold goods and services through eBay and reached the $600 threshold, the IRS requires us to send you a Form 1099-K. When your SSN, ITIN or name on your eBay account doesn’t match the IRS’s records, you’ll receive a back-up withholding notice (“B-notice”) through the regular mail.
eBay sends B-notices to the address on your eBay account. If you haven’t received a B-notice through mail, or if you need to verify and update your information by uploading a Form W-9, you can do so through Seller Hub or My eBay.
What should I do when I receive a B-notice?
If I received a B-notice through regular mail, but submitted a W-9 digitally, do I also need to mail in a W-9?
What if I don’t have a SSN? Can I provide an ITIN or apply for a SSN?
The IRS requires us to collect a valid, verified SSN or ITIN if you sell more than $600 on eBay. If you don’t have a SSN it’s acceptable to provide an ITIN. You can find more information about applying for an ITIN from the IRS.
Should I put my business name or personal name on the W-9
The taxpayer ID number type you choose depends on whether you’re filling out a tax form for personal or business tax purposes.
If you’re paying personal taxes, your federal tax ID number is an SSN or ITIN. When you’re filing a business tax return, you would use an EIN number. It is important that you use the legal name associated with your EIN.
I’m a registered business. Do I still need to provide my Taxpayer Identification Number?
Yes. If you’re selling as a business entity (sole proprietor/single member LLC, corporation/multi member LLC, partnership), you’ll need to provide the following:
- Individual identification information for beneficial owners, officers, directors, or account managers
- Legal business name
- “Doing Business As” (DBA) name (if you have one)
- SSN, ITIN or Employer Identification Number (EIN)
- Business address
- Phone number
What happens if I don’t provide my SSN, ITIN or EIN?
Since this information is required for all sellers with sales over a certain amount, if you don’t provide us with a SSN or ITIN, your payouts will be put on hold, your ability to list and sell on eBay may be restricted, and we may deduct backup withholding from future payouts. If this information doesn’t pass verification, your selling experience may be restricted until we verify your details. For more information, contact us.
Why haven’t other selling platforms asked for my SSN?
We can’t speak for other platforms, but the same rules will apply if you sell $600 or more on other sites. This law is an industry-wide rule that applies to all third party settlement organizations and payment processors, including online marketplaces that process payments.
Accessing and using your 1099-K
How do I receive my 1099-K?
Can eBay help me with my tax return?
We can provide you with transaction information but we’re unable to give you tax advice. Please reach out to a tax professional if you have any questions or concerns about any tax filing or regulations.
Will I receive a 1099-K for my eBay sales if I’m a US citizen and file US tax returns, but live in a different country?
Yes, the requirements apply to United States citizens selling in other countries.
How does this affect me if I am not a US citizen or resident?
These 1099-K reporting requirements won’t impact you if you are a non-US citizen and non-US resident selling on eBay. However, you may be required to provide a Form W-8 to eBay in order to claim non-US status.
What if I’m a casual seller?
We realize providing personal information and receiving a tax form is not ideal for casual sellers. The impact of this change will be that millions of Americans cleaning out their garage or selling a few used items to make extra money will now receive a 1099-K tax form. See what we’re doing to help.