I think there may be a wrong "gross amount" on my 1099-K, is it actually wrong?

[aaron5596]

I received my 1099-K, for the 2022 tax year, from a marketplace where I sell my digital product. They are a Third Party Network. They take 12% of all the payments I receive through them.

In the field on my 1099-K where it says “1a Gross amount of payment card/third party network transactions”, the amount they have there is the same amount of money I received to my bank account after they took their 12% (which would not be the gross amount, to my understanding). Shouldn’t the amount in that field be the 100% of the payments, before they took their 12%?

That was the case for 2021’s 1099-K from them, it was the gross of the 100%, before they took their cut, then I just listed the 12% marketplace fee as a deduction on my return for 2021.

2021’s 1099-K had the gross amount before they took their 12% for that year, in that field. 2022’s 1099-K had the amount after they took their 12% for that year, in that field. So my question is, which is correct...cause they both can’t be, right?

Thank you for any help you can offer,
Aaron

[MonikaK1]

You are correct, the payer is required to report gross payment card and third-party network transaction amounts to the IRS. See this IRS FAQ for more information.

Contact the payer regarding any issues with your Form 1099-K. If you confirm that they reported the net instead of the gross, and they won't issue a corrected form, you can report the amount shown on the Form 1099-K; then, report the fees separately as other income not reported on a form and take a deduction for the fees paid. That way, your income reported from a Form 1099-K will match what was reported to the IRS so that their matching system doesn't show a discrepancy.