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Retirement tax questions
In 2017, the rules changed for reporting income through a “third party network” in MA; now anything over $600 has to be reported to MA IRS (but not to Federal IRS; it’s only reportable to the Feds if it’s over $20,000 AND 200 transactions).
However, not all of this income is necessarily taxable. The MA IRS webpage says that “Form 1099-K is an informational document. You should use the information reported in conjunction with your other records to determine whether it’s taxable income and to determine your correct tax.”
They also give examples. People who receive income from Uber or Lyft should report it; people who make a profit should report it; people who sold items at a personal loss should NOT report it; people who are receiving reimbursement for an expense should NOT report it.
See the MA IRS website for more info: https://www.mass.gov/service-details/frequently-asked-questions-about-1099-k-notices-from-third-part...