The IRS is sending out notices related to Form 1099-K which reports third party network and merchant services revenue paid to your business. If you take credit cards (or payment firms such as PayPal) as a form of payment for your customers, your service provider will send you Form 1099-K to report the revenue paid to your business. The IRS will receive a copy of the forms and will cross check this against the income reported on your business tax return. If it doesn’t agree you will receive a notice.
Additional details are available with the link: New Notices Related to Form 1099-K.
If you read my blog religiously, as I know you do, you already know about the 3 simple rules to keep the IRS off your back, with one of the rules being, “Respect the 1099 Forms”. Respecting the 1099 forms means you are reconciling your books to the forms before you are preparing your tax return. That means you won’t get one of those lovely notices from the IRS. If however, you did not follow this rule, you may be receiving a notice.
Upon receipt, call me!
Don’t Worry – Protect Yourself! – Holt Pros