You must report amounts from Form 1099-K if they are taxable income under federal law. Form 1099-K is an information return that reports payments you received for goods or services through payment cards, payment apps, or online marketplaces. It generally shows gross payments (before fees, refunds, or other adjustments), so you must use your records to determine the net taxable amount.

Income reported on Form 1099-K is generally taxable if it reflects business, self-employment, freelance, or other goods-or-services transactions. Use Form 1099-K together with your books and records to determine what you must include in income.

You generally do not have taxable income if the Form 1099-K reflects personal payments such as gifts, reimbursements, or amounts exchanged among family or friends for shared personal expenses. If you receive a Form 1099-K in error, ask the issuer for a corrected form. If a corrected form is not available in time, current IRS guidance instructs you to still file your return and use the IRS correction method on Schedule 1 (Form 1040) so that the erroneous Form 1099-K amount has no net effect on adjusted gross income.

If the Form 1099-K relates to the sale of personal-use property, a gain is generally taxable and a loss is generally not deductible. Business or self-employment income is usually reported on Schedule C (Form 1040), and taxable gains from sales of capital assets, including personal-use items sold at a gain, are generally reported on Form 8949 and Schedule D.

Whether a Form 1099-K must be issued is governed by 26 U.S.C. § 6050W and related guidance; these rules determine when payors must furnish Form 1099-K but do not change whether income is taxable.

State Law Note

State income tax treatment of amounts reported on Form 1099-K can differ. The controlling authority is your state revenue department or tax agency, and many states start from federal adjusted gross income and then apply state-specific rules.

Sources

IRS — What to do with Form 1099-K

IRS — Understanding your Form 1099-K

IRS — Actions to take if a Form 1099-K is received in error or with incorrect information

IRS — About Form 1099-K

IRS — 2025 Instructions for Schedule C (Form 1040)

IRS — About Schedule C (Form 1040), Profit or Loss From Business

IRS — About Form 8949, Sales and Other Dispositions of Capital Assets

IRS — Instructions for Form 8949

IRS — Schedule D (Form 1040), Capital Gains and Losses

Internal Revenue Code — 26 U.S.C. § 61, Gross income defined

Internal Revenue Code — 26 U.S.C. § 6050W, Returns relating to payments made in settlement of payment card and third party network transactions