WHY AM I RECEIVING A 1099-K FROM STACK SPORTS OR SPAY, Inc
Internal Revenue Code (IRC) Section 6050W states that all US payment processors, including SPay, Inc. dba Stack Sports, are required by the Internal Revenue Service (IRS) to provide information to the IRS about certain customers who receive payments for the sale of goods or services through Stack Sports and its subsidiaries.
Stack Sports is required to report gross payments received for sellers who receive over $20,000 in gross payment volume AND over 200 separate payments in a calendar year. In order to help you understand these information reporting obligations, we have prepared the following FAQs. After reviewing the following FAQs, we recommend you consult your tax advisor to assess tax implications of Form 1099-K reporting.
How will I know if these rules affect me?
Stack Sports will track the payment volume of your account(s) to check whether your payment volume exceeds both of these levels in a calendar year:
- $20,000 USD in gross payment volume from sales of goods or services in a single year
- 200 payments for goods or services in the same year
You may be asked to provide your tax ID number, such as a Social Security Number (SSN) or Employer Identification Number (EIN), to your existing account(s), if you don’t already have one on file.
If you cross the IRS thresholds in a given calendar year, Stack Sports will send Form 1099-K to you and the IRS for that year early in the following year.
How is the $20,000 calculated?
As required by the rules, the $20,000 will be calculated by looking at a seller’s gross credit card payment volume for sales of registrations. Gross amount means that any adjustments for credits, cash equivalents, discounts, fees, refunded amounts or any other amounts will not be netted out.
Will all partners receive a form 1099-K?
No. Only partners who exceed the IRS thresholds will receive Form 1099-K. Partners exceed the IRS thresholds when they receive over $20,000 USD in gross payment volume for the sale of goods or services AND receive over 200 separate payments for registrations in the same calendar year. Please note certain states have a lower threshold of $500 USD gross payment volume which in turn would require the 1009-K form to be provided.
Why is my 1099-K tax form issued by “dba Stack Sports”?
Stack Sports has a number of different product solutions. The product you use operates under the DBA name of Stack Sports.
I didn’t receive a Form 1099-K and thought I was supposed to. What should I do?
It is possible there was an invalid address in our records. If so please contact Support to open a support ticket, or email email@example.com to help resolve.
Do I have to report the amounts from Form 1099-K on my tax return?
Please consult your tax advisor or contact the IRS for additional information on how the amounts reported on Form 1099-K should be reflected on your tax returns. Stack Sports cannot provide specific guidance on the tax implications of Form 1099-K reporting.
I have been a long-time partner with your company and have not received this document in the past. Why am I receiving this now?
As part of our commitment to your organization, we have made several enhancements to our payment remittance and accounting processes, including issuing 1099-K tax documents to our partners crossing the IRS thresholds in a given calendar year ($20,000 USD in gross payment volume from sales of goods or services in a single year and 200 payments for goods or services in the same year).
I didn’t receive any of the collected funds, why was my Tax ID reported?
The IRS requires Stack Sports to report gross activity based on the origin source of the funds. For our customers who collect League, State, and/or District fees while having Stack Sports remit those fees directly to their corresponding parent entity, per IRS guidelines we are required to report the originating source’s (i.e Club’s) Tax ID not the Tax ID of the destination entity (i.e. League, State, District).
How does the American Rescue Plan Act of 2021 impact my 1099-K?
The 1099-K you will receive in January of 2022 will be in compliance with the current rules in place for 2021 reporting. Beginning with the 2022 tax year, the requirements change. Stack Sports will be required to report gross payments received for sellers who receive over $600 in gross payment volume in a calendar year. Additional information will be available in 2022.
I still have questions, who should I contact?
You may submit a help ticket via our help center and someone from our support team will be happy to assist you. NOTE: For tax filing and reporting questions, please consult your tax advisor to discuss the tax implications of Form 1099-K.