Overview

The IRS has finalized its tax reporting rules for the 2026 filing season, bringing welcome clarity after years of uncertainty. The 1099-K reporting threshold will remain at $20,000, the IRS having officially abandoned its controversial plan to drop it to $600. Alongside this, new threshold increases for 1099-MISC and 1099-NEC forms are set to take effect, and non-US sellers face a critical documentation deadline.

What's Changing

• 1099-K threshold remains at $20,000 — The IRS is keeping the dual requirement of $20,000 in gross sales and 200 transactions, scrapping the long-delayed $600 proposal.
• 1099-MISC and 1099-NEC thresholds increasing — Beginning in 2026, reporting thresholds for these forms rise to $2,000, with future adjustments tied to inflation.
• Non-US seller documentation deadline — International sellers must update W-8 forms in Seller Central by June 30, 2025, or risk payment holds.
• All income still taxable — Whether or not a seller receives a 1099-K, every dollar earned on Amazon must be reported to the IRS.

1099-K Threshold Stays Put

Amazon will issue 1099-K forms by January 31, 2026 to any seller who hit both benchmarks during the 2025 calendar year: at least $20,000 in unadjusted gross sales and at least 200 transactions. The decision to maintain the higher threshold is a meaningful win for smaller sellers. The IRS originally planned to slash the threshold to $600 back in 2022, a move that would have triggered reporting obligations for millions of casual and part-time sellers. That proposal was delayed repeatedly amid pushback about the administrative burden on small businesses and gig workers.

For many Amazon sellers, particularly those running side businesses or selling at modest volumes, the $20,000 threshold means substantially less paperwork. However, sellers who fall below the reporting cutoff should not assume their income is exempt from taxes. The IRS requires all earnings to be reported on a tax return regardless of whether Amazon sends a form.

Non-US Sellers Face a Hard Deadline

International sellers have a specific compliance date to watch. W-8 forms and associated tax documentation must be updated in Seller Central by June 30, 2025. This paperwork confirms a seller's foreign tax status and determines the correct withholding rate on US-source income. Missing this deadline can trigger payment holds on pending disbursements, backup withholding at the maximum statutory rate, and restricted access to earnings until the documentation is resolved.