The Internal Revenue Service is preparing for its 2025 tax filing season, which kicked off Monday and runs until April 15. But this year, the IRS will be cracking down on one income source that often goes unreported: side hustles.
Viewed as income that comes through unconventional ways, side hustles are jobs that can be a profitable source of income but often go unreported when tax season rolls around.
“Whether someone is having fun with a hobby or running a business, if they are paid through payment apps for goods and services during the year, they may receive an IRS Form 1099-K for those transactions,” the IRS wrote in a post last summer when the announcement was made. “These payments are taxable income and must be reported on federal tax returns.”
Now, anyone who earned $5,000 in 2024 by selling goods such as musical instruments, tickets, books, handmade crafts, or anything else will get a 1099-K tax form this month.
The 1099-K form reports payments received from online marketplaces, apps, or resale platforms, such as eBay, Etsy, Venmo, CashApp, StubHub, and Ticketmaster.
If you were making more than $5,000 and were selling items on these platforms, you should expect to get a 1099-K form, which you are required to report when you file taxes on your income this year.
Previously, online marketplaces only had to send these forms to those who earned more than $20,000, but with the IRS cracking down on unreported income, the threshold has been lowered.