The IRS is lowering the Form 1099-K reporting threshold, but has delayed the date of the change by 1 year. Starting on January 1, 2023, IRS regulations require all businesses that process payments, including online marketplaces like eBay, to issue a Form 1099-K to sellers who receive $600 or more in gross payouts. If you receive $600 or more in gross payouts over the course of the 2023 calendar year, we'll provide a Form 1099-K to you by January 31, 2024. Your 2021 and 2022 tax obligations aren't affected by this change.
Am I required to pay taxes?
Starting for the 2022 tax year, Quidd is required to send out a 1099 Tax Form to those US-based collectors that have earned $600 or more in the 2022 calendar year.
What contributes to $600 or more?
First, let's explain what activity with your Cash Wallet contributes to the calculation of this "$600 or more" threshold.
Store Credits of any kind do not contribute to the calculation. You can receive $1 in Store Credits or $1000 in Store Credits and neither contributes to the calculation of $600.
Additionally, Deposits of any kind (In-App Purchase or Stripe) do not contribute to the calculation of $60.
Finally, the calculation of $600 is not affected by your withdrawals. If you earn $1,000 in Sales Proceeds on Quidd but do not withdrawal it, your Cash Wallet activity is STILL subject to this calculation. In direct terms, what you withdraw or not does not affect this calculation.
All that matters is how much you earn from sales, that is, your Sales Proceeds from January 1 through December 31, even if those proceeds remain in your Cash Wallet.
What will happen?
The Quidd team, in January 2023, will compile all this information for you and send those with Sales Proceeds of $600 or more a 1099 Tax Form by the end of January 2023.
This tax form must be sent via hard copy in the mail, which means Quidd will need your physical mailing address.
Before the end of 2022, Quidd will implement functionality that allows each collector at or near the $600 in Sales Proceeds threshold to safely and securely provide that information to Quidd, ensuring end-to-end encryption.
Additionally, we will increase customer service staffing by the end of the year to ensure all US taxpayers with $600 or more in Sales Proceeds a smooth process for receiving their 1099 Tax Form.
What about 2021?
Quidd will not be issuing 1099 Tax Forms to any collectors from 2021.
What about collectors located outside the United States?
Quidd recommends all non-US collectors with significant proceeds generated from sales of Cash Listings seek out professional tax advice for the 2022 tax year.