WASHINGTON – U.S. Rep. Chris Pappas (NH-01) and Congressman Ralph Norman (SC-05) sent a joint letter to House leadership requesting immediate bipartisan reform to Form 1099-K reporting requirements. As the leaders continue to craft their end-of-year legislative package, Pappas, Norman, and 27 other Members are urging Congress to raise the Form 1099-K reporting threshold.

“Selling used goods online is a pathway for Granite Staters to supplement their income and find old items a second life. While these transactions do not create a taxable income, burdensome reporting requirements may lead to a seller’s incorrect overreporting of income and resulting ineligibility for tax benefits,” said Congressman Pappas. “It’s vital that this issue be addressed to eliminate unnecessary confusion. I urge House leadership to heed this bipartisan call to raise the reporting threshold for Form 1099-K filings and support this commonsense fix.”

“Our priority should be to enable greater access to flexible earning opportunities, especially at a time when hard-working Americans are struggling to make ends meet due to four-decade high inflation. The last thing taxpayers need is additional government red tape and burdensome, unnecessary paperwork for online sales that do not produce income tax liability,” said Congressman Norman. “I implore House leadership to significantly raise the reporting threshold for Form 1099-K filings prior to millions of Americans needlessly falling victim to the IRS.”

Pappas’s Cut Red Tape for Online Sales Act would raise the reporting threshold for 1099-K reporting from $600 to $5,000 and require entities to issue a plain-language description of the taxability of income reported on Form 1099-K to reduce confusion among online sellers. Pappas’s legislation was listed on the National Taxpayers Union’s 2022 “No-Brainer” list of bills Congress should pass, and his repeated calls to raise the reporting threshold are supported by the American Institute of CPAs (AICPA).