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1099-K Tax Forms and Tax Season: Everything you need to know

We want to make sure you are prepared for tax season and that you have everything you need from Square to file your return. Let’s get started.

 

What is a 1099-K form?

 

The IRS requires Payment Settlement Entities, such as Square, to report the payment volume received by U.S. account holders. A 1099-K form is the information return that is given to the IRS and qualifying customers.

 

Do I qualify for a 1099-K form?

 

Square will provide a 1099-K form for you if meet both of the following criteria:

 

  1. You processed more than $20,000 in gross sales from goods or services in the calendar year 

*AND*

  1. You completed more than 200 card transactions (debit, credit and tap) in the calendar year. 

 

Note: Square may report, solely within its discretion, on amounts below these thresholds to meet state and other reporting requirements in: District of Columbia, Illinois, Maryland, Massachusetts, Missouri, Vermont and Virginia. Learn more in our Support Center.

 

How do I download my 1099-K form?

 

If you qualify for a 1099-K form you'll see a link to download your 1099-K form on the Tax Forms tab of your Square Dashboard. Forms will be available by January 31st 2021.

 

Where can I view my fees?

 

If you don't qualify for a 1099-K, you can calculate your year-end sales report (including fee information) from the Sales Summary tab of your Square Dashboard. Your tax professional may need this information to complete your tax forms.

How to view fees.gif

 

1099-K form and Tax Season FAQs

 

When will my 1099-K form be available? Forms will be available to download from your Square Dashboard by January 31st 2021.

 

What if I have multiple Square accounts? Our reporting thresholds of $20,000 and 200 transactions are based on the aggregate gross sales volume processed on all accounts that use the same EIN or SSN. If you have multiple accounts that use the same EIN, we will aggregate volume for all accounts and issue a 1099-K if you meet the thresholds.

 

How do I update my tax reporting information or add an EIN to my account? You can review and update your taxpayer information (legal name and EIN) from your online Square Dashboard — sign in from a web browser at squareup.com/login. Learn how to update your form 1099-K for a prior year.

 

How do I get an EIN? An Employer Identification Number (EIN) is a federal tax identification number used by the IRS to identify your business for tax purposes. You can apply for an EIN using Square’s free EIN assistant.

 

What’s a TIN? A Taxpayer Identification Number (TIN) is an identification number such as an SSN (for individuals) or an EIN (for businesses). These identification numbers are used by the IRS for tax purposes.

 

Corrected forms: Can I receive a blank/0 1099-K form? Square cannot issue a Form 1099-K with a zero dollar amount. A corrected form can be used to inform the IRS that the amount originally reported under the previous TIN should be updated and associated with the new TIN. Square will file the corrected form with the IRS during our next filing cycle, which occurs 3-4 times a year. Contact the IRS to work directly with them to ensure the businesses’ sales are not reported under the previous TIN.

 

Are cash transactions included in the 200 transactions threshold? The 200 transactions threshold is for credit, debit, and tap payments only and does not include other payments like cash, checks or other tender.

 

Additional Resources

 

 

Helen

Seller Community Manager, Square

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Message 1 of 52
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Admin

Best Answer

Learn more about Form 1099-K Tax Reporting Information or watch the video below to get ready for tax season with Square.

 

Helen

Seller Community Manager, Square

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Find step-by-step help in our Support Center

View Best Answer >

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Message 10 of 52
Admin

Best Answer

Hey @SpectrumCE and @hudsonbabylon!

 

The amount and transaction count on each form are calculated based on your gross sales on the transaction date of the sales. This includes revenue from card payments that were refunded. Please note that gross sales include taxes and tips collected on a sale if they are charged on the card.

 

If you're still confused by your eligibility or totals, please remember that cash sales are not included in the total we report on the Form 1099-K. Because of this requirement, the amount shown on this form will be different from the amount settled into your bank account. This is because you may have had refunds, chargebacks or holds, and Square’s fees were deducted before funds were transferred to your bank.

 

If you were not eligible or didn't receive a 1099k from Square - we suggest reaching out to a tax professional. 

 

 

Olive, she/her

Seller Community Manager, Square

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View Best Answer >

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Message 12 of 52
51 REPLIES 51

Hi everyone, 

Quick question. Is there a reason why my sales report for the year 2018 says one number, and then my 1099-K says a completely different number? Which number do I go with? Please advise. There is over a $10,000 difference. What gives? 

2,998 Views
Message 2 of 52

your 1099-k is all the transactions that were processed on credit cards BEFORE refunds.  It will match the left column of the "Card" row on this report.  https://squareup.com/dashboard/sales/reports/sales-summary

2,983 Views
Message 3 of 52

Thank you, are the "other" transactions checks then? I see cash, card, and then a mysterious other. 

3,164 Views
Message 4 of 52

other is checks and any other gift certificates or PayPal payments etc that you accepted and choose other at the time of the transaction.

3,153 Views
Message 5 of 52

PayPal and personal checks

2,963 Views
Message 6 of 52

I know this is an old thread, but I ran across it looking for something, and thought I'd check my own data. You state that the 1099K should match the card row in the sales summary report. I hadn't caught it before, but I now see that the card row and my 1099K for 2020 were actually off by about $125 - the 1099K being the higher number. The delta doesn't seem to match any returns, refunds, comps or discount amounts. Any thoughts about what that might that difference be attributed to?

532 Views
Message 7 of 52
Square Community Moderator

Hello @GOCoffee,

 

Great to see you posting again, welcome back! 😁

 

I wanted to include some information that may attribute to the discrepancy you are seeing in reporting.

 

Let's talk about refunds for a moment:

 

Refund Reporting
Because of this requirement, the amount shown on this form will be different from the amount settled into your bank account. This is because you may have had refunds, chargebacks, or holds, and Square’s fees were deducted before funds were transferred to your bank.

 

Another thing to consider is the timing of transactions processed.

 

Transaction Timing
The transaction date is the date in our system that the transaction took place, which is based on a standardized time known as UTC. Your online dashboard shows your transactions in your local time, so there may be small variances if you have transactions that occur between 5:00 pm and midnight in your local time zone.

 

 

Lastly, I wanted to include this  article with video that explains what data pulls into reporting.

 

 

Let me know if this helps clear some info up! 😁

 

 

Frida
Community Moderator, Square
Sign in and click Mark as Best Answer if my reply answers your question.
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Message 8 of 52
Beta Member

Thanks @Frida for the information. I can understand there being a small difference based on all of that.

   

411 Views
Message 9 of 52
Admin

Best Answer

Learn more about Form 1099-K Tax Reporting Information or watch the video below to get ready for tax season with Square.

 

Helen

Seller Community Manager, Square

Did you find help in the Seller Community? Mark a Best Answer to help others!
Find step-by-step help in our Support Center

View Best Answer >

47,263 Views
Message 10 of 52

I met the requirements but Square says I didn't and did not issue 1099. What should I do?

($39,000 IN SALES AND 274 transactions)

40,615 Views
Message 11 of 52
Admin

Best Answer

Hey @SpectrumCE and @hudsonbabylon!

 

The amount and transaction count on each form are calculated based on your gross sales on the transaction date of the sales. This includes revenue from card payments that were refunded. Please note that gross sales include taxes and tips collected on a sale if they are charged on the card.

 

If you're still confused by your eligibility or totals, please remember that cash sales are not included in the total we report on the Form 1099-K. Because of this requirement, the amount shown on this form will be different from the amount settled into your bank account. This is because you may have had refunds, chargebacks or holds, and Square’s fees were deducted before funds were transferred to your bank.

 

If you were not eligible or didn't receive a 1099k from Square - we suggest reaching out to a tax professional. 

 

 

Olive, she/her

Seller Community Manager, Square

Learn about the Super Seller program!

View Best Answer >

41,030 Views
Message 12 of 52

Is it possible to get an official report from Square? When I print the report page, just number show up - no store name or source of report?

40,502 Views
Message 13 of 52

Also I thought I met criteria for number of transaction according to requirement

40,501 Views
Message 14 of 52

How can I get a report from Square that has my store name and Square on it. I can only print a page with numbers no ide tidying source

40,375 Views
Message 15 of 52

My 1099-K is made out to my personal name and SSN not my business Name and EIN. How do I get this corrected? Everything in square is correct with my business information. 

41,999 Views
Message 16 of 52
Square Community Moderator

Hi there, @BeyondBarriers 👋 Thanks for reaching out to us here on the Seller Community!

 

Here is a helpful guide to walk you through what to do if you are needing a 1099-K edited. If you have trouble, feel free to reach out to our Support Team directly at any time!

Joe
Community Moderator, Square
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41,613 Views
Message 17 of 52

Should my Square 1099-K also reflect refunded transactions?  If so the 1099-K I received does not. 

40,704 Views
Message 18 of 52
Square Community Moderator

Hey @hudsonbabylon! We do not have a verification letter for tax reporting, but you can work with a tax professional to get this information. If you received a 1099-k, it will be under Account & Settings > Tax Forms on your Square Dashboard, but you will have to meet the credit card sales requirements as well as the credit card transaction requirement. If you only met one, we would not have issued a 1099-K and you will need to work with a tax professional again to obtain one. 

AshleyK
Community Moderator, Square
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Message 19 of 52
Square Community Moderator

@JoeBanzai I would recommend clearing your cache/history or trying from another browser!

AshleyK
Community Moderator, Square
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23,814 Views
Message 20 of 52

The amount shown on line 1a is what was actually paid to me after fees taken out by square,  Correct????

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Message 21 of 52