For tax year 2011, the IRS asks recipients of the Form 1099-K, Merchant Card and Third–Party Network Payments to include the business income from 1099-Ks as part of the aggregate total with other business receipts on their tax returns.
The “What’s New” section in the instructions for Form 1040 Sch. C,Sch. E and Sch. F has information for reporting the income on 2011 tax returns.
Please note: This does not change the requirement that responsible entities file and furnish Forms 1099-K for 2011.
Form 1099-K, Merchant Card and Third Party Network Payments
A payment settlement entity (PSE) must file Form 1099-K for payments made in settlement of reportable payment transactions for each calendar year. A PSE makes a payment in settlement of a reportable payment transaction, that is, any payment card or third party network transaction, if the PSE submits the instruction to transfer funds to the account of the participating payee to settle the reportable payment transactions.
Instructions for 1099-K ( HTML)
General Instructions for Certain Information Returns (Forms 1097, 1098, 1099, 3921, 3922, 5498, and W-2G)
Other Items You May Find Useful:
Third Party Reporting Information Center
Comment on Form 1099-K
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