Tax Information Reporting Form 1099-K

What you need to know

U.S. sellers who receive more than $20,000 in gross proceeds and more than 200 transactions within the calendar year will receive IRS Form 1099-K, Payment Card and Third-Party Network Transactions, reporting total gross proceeds by month for the prior year. Foreign sellers earning US source income subject to withholding will receive IRS form 1042-S, Foreign Person’s US Source Income Subject to Withholding. (This is rare.)
Please note that FastSpring’s 1099-K will be issued under FS Intermediate Holdings, Inc., which is the parent entity of FastSpring.
If you have not yet confirmed your tax status by completing the W-8/W-9 tax questionnaire, please do so here. This information is required for accurate reporting.
Gross proceeds are not the same as taxable income. You are taxed on your net profit, not the gross amount reported on Form 1099-K. Your taxable income will reflect adjustments such as returns, fees, operating expenses, etc.
While FastSpring cannot provide tax advice, we aim to make tax compliance as simple as possible and are here to support you with any questions about the reporting process.

Frequently asked questions

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. It includes adjustments for discounts and taxes, but NOT for refunds/returns and fees.

Why do I need a 1099-K?

Merchants of Record and other online marketplaces like FastSpring must report certain transactions once they exceed a stated amount. For payment processing activities, IRS regulations require FastSpring to issue 1099-Ks for qualifying US sellers. When calculating your taxable income for your income tax return, you should consider the amounts shown on your 1099-K.

What about state-level reporting requirements for Form 1099-K?

A handful of states use a lower reporting threshold than the IRS, including AR, DC, IL, MD, MA, MS, NJ, VT, and VA. State-only forms will be issued to qualifying sellers.

What does Form 1099-K include?

Form 1099-K reports your total gross proceeds from all selling transactions within the calendar year when you exceed both of the following IRS thresholds for that year:

More than $20,000 in gross proceeds, and
More than 200 transactions

If these thresholds are met, your total gross proceeds will be reported by month and adjusted for the following:

Discounts
Taxes

How to confirm 1099-K Gross amount from box 1a vs storefront Reports?

Navigate to the Reports section and change the period to “Last Year.”
“Net Revenue” + “Refunds” should tie to the 1099-K box 1a.
If multiple storefronts, then repeat the process for each storefront and combine the amounts.
Example:

How is Form 1099-K different from other 1099s?

The type of form depends on the characteristics of the money being received. The purpose of a 1099-K is to disclose the amount of money a payment processor or online platform is transacting with on your behalf.

Will I have to pay taxes if I receive a 1099-K?

Not necessarily. Just because you receive a 1099-K doesn’t mean you’ll owe taxes on the amount reported. The 1099-K shows your gross proceeds, which are different from profits. You pay tax on your profits, not your gross proceeds. You use gross proceeds to compute your profit, which also includes amounts for returns and allowances, operating expenses, etc.

What if I have multiple storefronts?

Storefront activity will be aggregated under a seller's account ID and reported on a single Form 1099-K. If a seller has multiple account IDs but under the same organization, amounts will also be aggregated.

What if I have a split payee or receive payments as a split payee?

The income a split payee receives is included on the parent seller's 1099-K. A split payee will not receive a tax form.

How do I receive my Form 1099-K?

For qualifying sellers, forms will be mailed out to your address on file. You can request an electronic copy by reaching out to [email protected].

What if my personal information or address on the form is not correct?

Identifying information is pulled directly from your storefront. To make any tax form updates, please update your Tax Information within your storefront.

On the dashboard page select Account Summary.

Under the Tax Information section select Manage Tax Information.

Select update and complete the online questionnaire to update your tax information.

Once updated, reach out to [email protected] to request form reissuance.

Will I receive a form if I’m not a US citizen or resident?

1099-K reporting requirements will not apply if you are a non-US citizen and non-US resident selling on FastSpring. We require a completed Form W-8 in the online questionnaire to properly claim non-US status.

What should I do with Form 1099-K?

The amounts reported on your 1099-K should be reported on your tax return.

Sole Proprietorships would generally report this income on Form 1040 Schedule C
Corporations or partnerships would generally report this on the entity return: Form 1120/1120S/1065.

The form does not need to be submitted with your return. The copy provided is for your internal records.

I lost my original form 1099-K, where can I find a copy?

You can request an electronic copy by reaching out to [email protected].

Why is the form from FS Intermediate Holdings, Inc. and not FastSpring?

Legally, under IRS entity rules, the FastSpring operating entity (Bright Market, LLC) is disregarded for federal tax purposes. Bright Market LLC’s parent company, FS Intermediate Holdings, Inc., is the reporter and filing entity for FastSpring operations.

FastSpring does not provide legal, tax, or accounting advice. This material is being provided for informational purposes only and is not intended as, and should not be relied upon for, legal, tax, accounting, or other professional advice. Please consult your own legal, tax, and accounting advisors for advice specific to your situation.