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Christian, as Lion has pointed out several times all Income is taxable unless specifically exempted by law. The $ amount of the reporting threshold whether it's $20,000, $5,000 or $600 does not determine the taxability of of your client's $1,300.

Copied from The Journal Of Accountancy: https://www.journalofaccountancy.com/news/2025/feb/boi-smith-case-fincen-motion-to-stay.html

I think it's pretty clearly stated in the regs https://www.law.cornell.edu/cfr/text/26/1.408A-8 And the limits as stated in the regs https://www.law.cornell.edu/cfr/text/26/1.408A-3 refer to reducing by amounts contributed to traditional IRAs (as defined above). (But SEP/SIMPLE plan contributions are not included in the MAGI calculation.)

New client that had ACA plan 2023 with no advance credits. I don't know why in that case they don't list what the SLCSP is on the 1095A, but they don't. They were over 400% FPL, but with new formula that doesn't preclude credits. Looking up the SLCSP and putting in on 8962 resulted in over 4K credits on amended return! I know there are people here that don't deal much with ACA clients, so wanted to let them know it's available. I generally amend close to half the new clients from this preparer, so not surprised they missed it. Don't be a Jim!

On my own return I have an IRA gross distribution of XXX and taxable amount of X in box 2a with a QCD of XX listed and the box checked below. No matter whether I input the taxable amount or assume it will be calculated, the taxable amount does not appear on page 1. I really hope I don't have to call support as I spent about 6 hours Friday-Tuesday getting a solution to my TY2023 program not opening. HAH! Nevermind. A last attempt proved to be the solution. Leave out the amount (which I know to be taxable, X, in box 2a, check 2b Check if taxable amount not determined. I guess we are not trustworthy enough to actually determine the taxable amount so must allow the program to do the calculation. Oh well, as long as it works now and I don't have to call support. Have a nice day!

That's true, but where this taxpayer is losing the ability to contribute to the Roth isn't in the AGI/MAGI computation. It is because the self-employed SEP IRA contributions on Sch 1, line 16 are flowing to the IRA limitation worksheet itself, specifically line 9 that says "Enter Contributions for the Year to Other IRAs".

One reason is if the policyholder doesn't provide information on all persons in the household because he or she isn't requesting the advance credit, then col B will be blank. It can also happen for months when someone's coverage starts on a date other than the first of that month.

It was on a w2

Right click on a field. There are three options in the popup menu that may be sufficient for what you want to do: Insert/Edit Note Tick Marks Mark as Estimate Under Tick Marks, you can mark a field as needing review and then you can insert a note as to why you think the field is incorrect.

Well, Drake is handling it properly, and I wouldn't consider that to be forcing anything or arriving at a conclusion based on anything implied or pervasive feelings. You might consider IRC sec 408(k) that clearly defines a SEP as an IRA.

"Clear" is a far cry from how the irs has gone about issuing and changing guidance on this issue. But the guidance currently states: Nowhere in the guidance does it state a company is not to file 1099Ks for amounts under $5000. There's also the fact that the irs guidance doesn't change the law, which says the threshold is $600.

Here's PayPal's page where I got that information: https://www.paypal.com/us/cshelp/article/current-form-1099-k-reporting-thresholds-2024-update-help1131

Finally found what I mentioned earlier about residents of some states receiving the 1099-K because of lower reporting thresholds. The statement below is from PayPal, but I remember the same statement in the email from Square.

Fwiw, Drake doesn't even have a place to enter 1099K data. For my husband's Sch C, I just entered the gross sales that includes the credit card payments.

I suffer from auditophobia (I just made that up). I enter my sales from my accounting software and I enter the 1099s and I have a line item under my sales for "less 1099s received" as a negative number. It is only a couple extra key strokes but I can show that I have included any 1099s in my tax return if I am ever audited. Hey, I never want to have to ask one of you to represent me at audit and then have you think I don't keep good books and records. Tom Longview, TX

I got one as well from Block as expected and properly recording the CC sales. ATX 1099K form entry and linked to my Sch. C. Just like a 1099NEC, just a different form entry screen. The trick this year is to know if it is legit reportable income or personal in nature (like paying friends for personal expenses or selling stuff on eBay for a personal loss). Tom Longview, TX

My husband has a Sch C biz and was correctly issued one from Block (Square). I didn't keep the email because it didn't apply in his circumstance, but there were lower thresholds shown depending on the recipient's state that may be the reason your client received one from E-bay.

If you are using ATX, you would enter the 1099K, assign it to other income, and at the top of Schedule 1 there is a box for amounts that are in error on the 1099K or for personal sales with losses. At least I think that is the wording. But in any case, enter the 1099K and then put the $1,300 in that box and it should go away. I have not had to do this yet so please let me know if it works as advertised. @jklcpa if this does work, you may want to pin the instructions for this year as it is new and I think we are going to see this question come up a lot during the tax season. Your call, just a thought. Tom Longview, TX

I agree with Terry, Ignoring it might trigger a CP 2000 notice. The IRS has good guidance on how to handle 1099 K: https://www.irs.gov/businesses/what-to-do-with-form-1099-k

I don't know that I would Ignore it. Depending on what software you use, you may be able to breakdown the income in a statement. Drake allows this. In the input box for the gross income/receipts, I click on the box and it opens a statement. There I indicate the 1099K with EIN and amount so it is included in the gross income. There really is no other way to input any information from a 1099K that I know of.