I read I should report both 1099-K's income, and then in the miscellaneous expenses section offset the duplicate 1099-K's income with a correction line for the same amount.
Does this method sound correct, or has anybody experienced a similar situation and how did you go about it?
No, 1099-K's are not specifically reported on your return. There is not a spot to add a 1099-K. You would just report the income you received, which could be just from your records. If you know you earned $50,000, then this is the income you would report, even if you received 2 1099-k's showing that you received $50,000 each for a total of $100,000.
If for some unlikely reason the IRS would contact you because you are reporting too little income, then you would simply respond that this was a duplicate. They should notice that the income is duplicated if the exact numbers are being reported.
Hello. Is Vanessa's 2022 answer still current?
My sole-proprietor small business makes money on Fiverr.com, and other jobs through ebay and facebook and in-person. All these sources pay me through PayPal, but some sources (Fiverr) send me 1099-Ks that report the same income that the PayPal 1099-K includes. Because I also receive money through PayPal from other sources, the amounts are not the same.
For example, I received $25k through PayPal, comprised of:
$10k from Fiverr
$12k from other sources like ebay or in-person
$1k as gifts from family and friends.
When entering my 1099-Ks into TurboTax-Deluxe, there is a box to "Enter the amount that should not be included". Should I enter the full amount on the PayPal 1099-K (deducting the $1000 given from friends and family) and then enter the full amount for the Fiverr 1099-K and deduct the entire $10k in this box?
Thanks!
Yes, that's the right way to enter it. @Vanessa A's answer is still correct except now there is a place to enter Form 1099-K into TurboTax.