If you sell on Amazon, eBay, or Walmart Marketplace and move real volume as a wholesale reseller, there’s good news on the tax paperwork front for 2026: the federal 1099-K reporting threshold that had been set to drop to just $600 is no longer happening. Congress reversed course, and the original, much higher threshold is back for the 2026 tax year.
What Changed
Back in 2021, the American Rescue Plan Act (ARPA) lowered the 1099-K reporting threshold for third-party payment platforms and marketplaces from $20,000/200 transactions down to just $600, with no transaction-count minimum at all. The IRS delayed that phase-in multiple times over the following years, so it never fully took effect. In July 2025, the One Big Beautiful Bill Act (OBBBA) repealed the $600 rule entirely and restored the original threshold. The IRS confirmed this in Fact Sheet 2025-08, issued October 23, 2025.
The result for tax year 2026: a marketplace or payment platform only has to issue you a Form 1099-K if you receive more than $20,000 AND more than 200 transactions in a calendar year. Both conditions have to be met – a seller with 300 transactions totaling $12,000 doesn’t cross the threshold, and neither does a seller with one $25,000 transaction.
What This Means If You’re Below the Threshold
If your marketplace sales land under $20,000 or under 200 transactions for 2026, you likely won’t receive a 1099-K from Amazon, eBay, or your payment processor. That’s a real reduction in paperwork for smaller resellers compared to what the $600 rule would have required.
It’s worth being clear about one thing this change does not do: it doesn’t change what income you owe tax on. Every dollar of business income is still reportable on your tax return, whether or not a 1099-K shows up in your inbox. Not receiving the form is a reporting-paperwork outcome, not a tax-liability outcome – keep your own sales records regardless of whether you cross the federal threshold.
Watch Your State’s Threshold Too
The $20,000/200-transaction rule is the federal standard, but several states set their own, lower 1099-K thresholds that apply regardless of what the IRS requires federally. Reports place Massachusetts, Vermont, Virginia, Maryland, Illinois, Arkansas, New Jersey, and D.C. among the states maintaining thresholds well below the federal level (several around $600). If you’re registered or selling into one of these states, you may still receive a 1099-K there even while staying under the federal threshold – check your specific state’s current rule rather than assuming the federal number is the only one that applies to you.
Why This Matters for Wholesale Resellers Specifically
Wholesale resellers buying case-quantity inventory to move on Amazon FBA are exactly the sellers most likely to cross 200 transactions and $20,000 in a normal year of steady reselling – which means the federal threshold is still very achievable for anyone doing this at real volume, even with the $600 rule gone. The practical takeaway isn’t “1099-K reporting is over” – it’s that the paperwork burden calibrates back to sellers actually operating at a meaningful scale, which is where most wholesale resale businesses already sit once they’re past the startup phase.
- Keep your own sales and cost records year-round regardless of whether you expect a 1099-K – your tax return needs the numbers either way.
- Check your state’s specific threshold if you’re registered to collect sales tax in a state with a lower 1099-K bar, since that can trigger a form even under the federal $20,000/200 rule.
- Don’t assume last year’s form (or lack of one) predicts this year’s – the threshold rules have shifted twice in a few years, so it’s worth a quick check each tax season rather than assuming the prior rule still applies.
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FAQ
What is the 1099-K threshold for tax year 2026?
More than $20,000 in gross payments AND more than 200 transactions in a calendar year, for third-party payment platforms and marketplaces. Both conditions must be met – meeting only one doesn’t trigger the form.
Did the $600 1099-K threshold go into effect?
No. It was set to phase in starting with tax year 2022 under a 2021 law, but the IRS delayed it repeatedly, and in July 2025 the One Big Beautiful Bill Act repealed it entirely, restoring the original $20,000/200-transaction threshold.
If I don’t get a 1099-K, do I still owe tax on my sales?
Yes. The 1099-K threshold only affects whether a marketplace or payment platform sends you a reporting form – it doesn’t change what income you’re required to report on your own tax return. Keep your own records regardless.
Related reading: Sales Tax Nexus for Wholesale Resellers: What Multi-State Selling Means for You | Do You Need a Resale Certificate to Buy Wholesale? | How Much Capital Do You Need to Start Amazon FBA Wholesale in 2026?
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