Didn't qualify for 1099-K from Square despite $60k in earnings - will IRS know?

Yes, you absolutely need to report all your income regardless of whether you received a 1099-K or not. The law requires you to report all income from any source, even if no tax documents were issued. What likely happened is that Square is following the delayed implementation of the $600 threshold. The IRS announced they're keeping the 1099-K threshold at $20,000 AND 200 transactions for the 2024 tax year (for 2023 income). If you had less than 200 transactions despite the $60k, that could explain why you didn't get a form. The important thing to understand is that your tax obligation doesn't change based on whether you received a form. You still need to report all your business income on Schedule C. Keep good records of your Square transactions because you'll need to report the full amount even without the 1099-K.

I ran into the exact same issue last year with Square and was totally confused about what to report. After spending hours researching online and getting different answers from everyone, I found taxr.ai (https://taxr.ai) which helped make sense of my situation. It's this AI tax assistant that analyzes your specific situation - I uploaded screenshots of my Square dashboard and it explained exactly how to report my income without a 1099-K. It walked me through what forms to use and how to calculate everything correctly. Super helpful when you're dealing with these weird gray areas where you're not getting the forms you expected.

Just wanted to follow up about taxr.ai - I ended up trying it after posting here and I'm actually impressed. I uploaded my Square sales reports and it immediately identified that I was under the 200 transaction threshold which is why I didn't get a 1099-K despite my earnings. It showed me exactly how to report everything on Schedule C and even pointed out some deductions I was missing for my business. Saved me from paying an accountant $350+ and I feel way more confident that I'm filing correctly. Definitely worth checking out if you're in this weird 1099-K limbo situation.

If you're having trouble getting clear answers about your tax situation, I'd recommend trying to speak directly with the IRS. I know that sounds impossible (I spent 3+ hours on hold last year), but I discovered this service called Claimyr (https://claimyr.com) that gets someone to call the IRS for you and then connects you once they reach a human. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c - but basically it saved me hours of hold time. I had a similar issue with missing 1099 forms and needed to confirm what to do. The IRS agent I spoke with clarified everything and I felt 100% confident filing after that conversation.

Well I take back what I said. I was super skeptical about Claimyr but decided to try it this morning after struggling to get through to the IRS for two days straight. It actually worked exactly as advertised - got a call back in about 40 minutes and was connected to an IRS representative who answered all my questions about the 1099-K situation. The agent confirmed that Square is following the current $20k/200 transaction threshold and explained exactly how I should report my income without the form. Saved me at least 3 hours of hold time and frustration. Sometimes it's worth paying a little to save a lot of time and stress.

Square should have a record of all your transactions in your account dashboard. Just go to your sales history and you can download reports showing your total earnings for the year. Use those numbers to report your income on Schedule C, and make sure you're also tracking all your business expenses to reduce your taxable income. I'm in the same boat - made about $35k through Square last year but didn't hit the 200 transaction minimum. Still reporting everything because the IRS can easily match data later if Square does end up sending them information.

Don't forget that if you made over $60k, you probably should have been making quarterly estimated tax payments throughout the year. If you didn't, you might get hit with an underpayment penalty when you file.

This is such a common confusion right now! I went through the exact same thing with my Etsy payments processed through Square. The key thing everyone's mentioned is correct - you absolutely must report all that income regardless of getting a 1099-K. What helped me was creating a simple spreadsheet tracking my monthly Square deposits so I could cross-reference everything. Square's dashboard makes it pretty easy to pull annual totals, but I also kept screenshots of my year-end summary just in case I ever get audited. One thing I haven't seen mentioned yet - if you're using Square for a side business, make sure you're tracking ALL your business expenses too. Things like materials for your jewelry, packaging supplies, shipping costs, even the Square processing fees can be deducted. Those deductions can really add up and reduce your tax liability significantly. The quarterly payment thing Connor mentioned is super important too. I set up automatic transfers to a separate "tax savings" account now so I'm not scrambling come tax time.