Smith Statement on 1099-K Delay

Washington, D.C. – Rep. Adrian Smith (R-NE), a senior member of the House Ways and Means Committee, released the following statement after the Biden administration announced it was delaying enforcement of its new 1099-K income reporting threshold for one year:

“I am pleased the Biden administration recognized the disaster their new 1099-K requirement will be for American families and for the IRS. Tax filers are not prepared to receive these forms, much less the audits that would occur should they incorrectly include them in their filings. The Biden administration has failed to address the IRS’s return processing backlog as promised, and this requirement will undoubtedly overwhelm the agency even more.

“While delaying 1099-K is a step forward, we have more work to do. Bank surveillance efforts, 1099-Ks, and 87,000 new IRS agents are all part of a comprehensive Biden administration effort to surveil and tax American families at every turn, even as they struggle with product shortages and record-high inflation. House Republicans will address these intrusions head-on in the year ahead.”

IRS form 1099-K is issued by online payment services, including money transfer services, online retail sites, and gig employment networks to report income. In 2021, House Democrats added a last-minute provision to their American Rescue Plan Act (ARPA) lowering the threshold requiring issuance of a 1099-K from $20,000 and 200 transaction to $600. This ARPA provision would expand the issuance of 1099-K forms to millions of Americans, many of them for non-taxable transactions such as splitting restaurant checks with friends or selling used personal goods from their household online for less than they paid.