Why Did I Receive Two 1099-K Forms?
If you've processed payments through multiple platforms in a given year, such as Propay and Stripe, it’s possible to receive two 1099-K forms for the same year. Here's what you need to know to understand why this happens and how to navigate it:
Understanding the 1099-K Forms
The IRS requires payment processors like Propay and Stripe to issue a 1099-K form to report the gross payments you’ve received through their platforms during the year. Each processor will issue a separate 1099-K based on the transactions that took place on their platform. So, if you used both Propay and Stripe during the year, you’ll receive one form from each processor detailing the transactions made through their services.
What Happens If You Switch Processors Mid-Year?
For example, let’s say you were using Propay for most of the year and switched over to Stripe in November. In this case, you will receive:
Propay 1099-K: This will report all the payments processed through Propay for the time you used it in the year (up until the point you switched). Please note that you may get 2 different forms one for ACH and one for card transactions.
Stripe 1099-K: This will report only the payments processed through Stripe, which will include transactions from when you made the switch to Stripe to December.
If you switched processors mid-year, don’t worry! Each processor is only responsible for reporting the payments processed on their platform, so the 1099-K forms will be split accordingly.
Check Your Stripe Account for the Exact Start Date
To confirm when you switched to Stripe, you can check your payment account dashboard by going to your payment accounts page. In Stripe, you can look up the date you created your account to verify when you started processing payments through their system. This will help you understand which payments are included in your Stripe 1099-K form.
How Do I Handle This?
This year may be a bit tricky for those who’ve used multiple processors, especially with Propay releasing their digital 1099-Ks in the coming weeks. Here’s what you can do:
Review Both 1099-K Forms: Make sure the total amounts from both processors (Propay and Stripe) are accurate and that they reflect your transactions for each platform.
Consult Your Accounting Team or a Tax Professional: If you’re unsure how to reconcile these two forms with your overall income for the year, it’s a good idea to seek guidance from a tax expert.
Key Takeaways
If you used both Propay and Stripe, expect to receive a 1099-K from each processor based on the funds processed through each platform.
If you switched to Stripe mid-year (e.g., in November), your Stripe 1099-K will only reflect transactions from November and December.
You may also receive separate 1099-Ks for credit card payments and ACH payments if you processed both types under Propay. Stripe will only issue out one form
Check your Stripe account for the start date to confirm which transactions are included in your Stripe 1099-K.
By keeping track of the platforms you’ve used and when you switched, you’ll be able to better navigate the year-end tax season and ensure your records are correct.
If you have more questions, don’t hesitate to reach out to your payment processor’s support team or consult with a tax professional!