1099-K Electronic Payment Facilitator/Third Party Network for my S- CORP.

[PTGeek]

my scorp got a 1099-k from a EPF 

This is literally not income... I do not receive any money from this organization. It is a "wholesale platform" where I am just an administrator. The total is $2399 so under the reporting threshold except I live in NC where I understand the threshold for reporting is > 600 for 2023. There is no obvious place to enter this in TT and to reiterate, I did not "earn" ANY MONEY from these sales. Do not want to include it in line 1a income for that reason. I am literally a "pass through entity"???

Any help appreciated! 

[JamesG1]

You want to report the income to let the IRS know that you acknowledge the IRS form 1099-K income.  

Then you reverse the income out with an explanation.  I would report the IRS form 1099-K as Hobby income and would follow these steps.

• Down the left side of the screen, click Federal.
• Down the left side of the screen, click Wages & Income.
• You may need to click Add more income.
• Scroll down to Other Common Income and click on the dropdown menu.
• Click Start to the right of Form 1099K.
• At the screen Did you get a 1099-K? click Yes.
• At the screen How would you like to upload your 1099-K? click Type it in myself. 
• At the screen Which type of income is your 1099-K for?, select the button for Hobby income.  Click Continue.
• At the screen Let’s get the info from your 1099-K, enter the information.
• Click This amount in box 1a is to high or includes some personal transactions.
• In the box enter the same amount to be reversed out.
• Click Continue.
• At the screen Your 1099-K summary, notice that the income relates to ‘Hobby’.  Click Done.

The entry will be reported:

• on line 8z of Schedule 1 of the Federal 1040 tax return, and 
• on line 8 of the Federal 1040 tax return.

There may also be a separate statement that reflects the income and the reversal of the income.

[PTGeek]

do these instructions apply to my S-corp taxes? The prompts you noted are different than what I am seeing on my end? 

[PatriciaV]

Please clarify which version of TurboTax you are using: Online or Desktop? Deluxe, Premium, Home and Business?

Also, are you asking if you can avoid reporting your S-Corp taxes?

[PTGeek]

I am using turbotax business online for my s-corp. Downloaded software for 2023 - if that is what you mean? 

no, I am not asking if I can avoid reporting it. Just trying to understand how it impacts my "income" since it is not really income. 

[RobertB4444 · Accepted solution]

It is income now.  If the 1099-K was issued to your business you need to include it in income.  The IRS has seen it and they will expect it to be there.

You can then enter an expense or series of expenses that relate what you did with the money.  If you paid it to one person or group then you should issue a 1099-MISC or 1099-NEC to them for the money that you paid out.  

If you paid it out to a bunch of different people and none of them received more than $600 then you can just make note of who you paid when and be done.  Either way, once you have finished with all the hassle it will be no increase to your taxable income.

@PTGeek