IRS Compliance

Received more than $20,000 in gross payments in a single year
Received over 200 payments in a single year

Merchants who fall into the above bracket will receive a 1099-K Form to detail their 2011 transactions and this will be reported to the IRS. As per the new regulations, we are required to verify that all merchants have the proper Tax Identification Number (TIN) associated with their account and that the number’s associated business name on file with the IRS matches your merchant profile, ensuring IRS compliance.

In accordance with the IRS Section 6050W, any merchant in the database that has a mismatch IRS status will have 28% of their funds withheld stand remitted to the IRS.

KEY POINTS ABOUT THE NEW LEGISLATION

All merchant types are affected
Merchants must exceed both the $20,000 gross payment volume AND the 200 transactions threshold to receive a 1099-K Form for IRS compliance.
The $20,000 gross payment volume is the total amount processed. Adjustments for discount amounts, fees, refunds, or any other amounts will not be subtracted.
Multiple merchant accounts that use the same TIN and whose totals exceed both thresholds will need to report each account on the 1099-K Form, ensuring IRS compliance.

Received more than $20,000 in gross payments in a single year

Received over 200 payments in a single year

All merchant types are affected

Merchants must exceed both the $20,000 gross payment volume AND the 200 transactions threshold to receive a 1099-K Form for IRS compliance.

The $20,000 gross payment volume is the total amount processed. Adjustments for discount amounts, fees, refunds, or any other amounts will not be subtracted.

Multiple merchant accounts that use the same TIN and whose totals exceed both thresholds will need to report each account on the 1099-K Form, ensuring IRS compliance.