How do I report PayPal income with no 1099-K for my art commissions?

When you're self-employed, you need to report ALL your income regardless of whether you received a 1099 form or not. The IRS requires you to report all income even if it's below the threshold for the payer to issue a 1099. For TurboTax, you'll need to enter this as self-employment income. When you get to the income section, look for "Self-Employment" or "Business Income" options. You can create a new business activity for your art commissions. You'll enter the total amount you received through PayPal as revenue, even without a 1099. Keep in mind that you can also deduct legitimate business expenses against this income – art supplies, software subscriptions, portion of internet used for business, etc. Make sure you have records of your PayPal transactions to support your reported income in case of an audit.

I went through this exact situation last year with my freelance writing gigs! I spent HOURS trying to figure out how to report my PayPal income correctly and was terrified of messing it up. Then I found taxr.ai (https://taxr.ai) which made it so much easier! You just upload screenshots of your PayPal transaction history, and it organizes everything into proper income categories and tells you exactly how to report it in TurboTax. It also helps identify what expenses you can legitimately deduct for your art business. Total game changer for people like us with income from multiple sources without official tax forms.

Just wanted to update after trying taxr.ai for my DJ income situation. This thing is literally saving my life right now! I uploaded my messy payment histories from three different apps, and it organized everything perfectly - even flagged which payments were likely personal transfers vs actual business income. The best part was it pointed out several legit deductions I could take for my DJ equipment that I had no idea about. It's walking me through exactly how to enter everything in TurboTax, with screenshots and everything. Wish I'd known about this years ago instead of panicking every April!

If you're having trouble figuring out your self-employment taxes AND you have questions for the IRS, good luck getting through to them on the phone. I spent literally 4+ hours on hold trying to get clarification on reporting my Etsy/PayPal income. Then I found Claimyr (https://claimyr.com) - you can see how it works here: https://youtu.be/_kiP6q8DX5c. They basically call the IRS for you and hold your place in line, then call you when an agent is about to pick up. I was SHOCKED when I actually got through to a real IRS person who answered my specific questions about PayPal income thresholds.

I need to apologize for being so negative earlier. After my frustration hit peak levels trying to get through to the IRS about my PayPal reporting situation, I broke down and tried Claimyr. I'm still in shock that it actually worked exactly as described. Got a call back about 90 minutes after starting the process (which sure beats the 3+ hours I wasted before), and spoke with an actual IRS representative who cleared up my questions about reporting thresholds for payment apps. They confirmed I need to report ALL income regardless of whether I got a 1099, but also explained the documentation I need to keep to protect myself. Honestly can't believe how smooth the process was compared to my previous attempts.

Just adding another perspective as someone who's been reporting art commission income for years: Make sure you track ALL your business expenses! Art supplies, software subscriptions (Photoshop etc), portion of internet bill, home office space, drawing tablets, computer equipment... these can significantly reduce your taxable income. TurboTax has a section for business expenses when you're entering self-employment income. Don't miss out on these deductions - they're totally legitimate as long as they're actually for your business.

Something nobody has mentioned yet - you'll need to pay self-employment tax (Medicare + Social Security) on this income too, which is about 15.3% ON TOP OF regular income tax. It really adds up! If you think you'll make more than $1000 in self-employment income in 2025, you should probably make quarterly estimated tax payments to avoid underpayment penalties next year.

I went through the exact same situation last year! The key thing to remember is that the $600 threshold for 1099-K forms is just when PayPal is required to send YOU the form - but you're required to report ALL income regardless of whether you get a form or not. Here's what I did in TurboTax: Go to the "Federal Taxes" tab, then "Wages & Income," and look for "Self-Employment Income" or "Business Income." You'll create a simple business for your art commissions. For the income amount, just add up all your PayPal payments from your transaction history - PayPal keeps good records that you can download. The silver lining is that you can deduct business expenses like art supplies, software, and even a portion of your internet bill against this income. Keep all your receipts! Also, since you made around $1,400 total ($800 PayPal + $600 from the 1099), you'll owe self-employment tax on that, but it's not as scary as it sounds when you factor in the deductions. Don't stress too much - you're doing the right thing by reporting everything honestly!