KEEN, Ingenio, LiveAdvice and Ether, as third-party settlement organizations, are required by law to report total amount of annual gross transactions collected from customers on behalf of advisors on Form 1099-K for those who meet the following thresholds in a calendar year:
- More than $20,000 in aggregate annual gross transactions (total amount collected from customers on behalf of advisors through KEEN, Ingenio, LiveAdvice or Ether, unadjusted for any fees or commissions advisors may incur operating their personal advice businesses)
- More than 200 paid transactions
If you have multiple accounts on KEEN, Ingenio, LiveAdvice or Ether, annual gross transactions of all accounts with the same Tax Identification Number (TIN), will be aggregated to determine if you meet the 200 transactions and $20,000 USD threshold. The total annual aggregate gross amount of transactions will be then reported on one Form 1099-K. Accounts with different TINs will be aggregated separately by TIN.
IRS regulations require non U.S. taxpayers to provide Form W-8BEN to us in order to be exempt from U.S. tax reporting requirements. For non-US advisors, we will contact you separately to collect this information.
What information will be provided to the IRS in the Form 1099-K?
The Internal Revenue Code section that requires this reporting says the aggregate annual gross amount of transactions must be reported, and the IRS's regulations indicate that this means the total dollar amount of aggregate reportable transactions, without regard to any adjustments for credits, fees, etc. Only transactions from the calendar year previous (e.g. January - December) will be reported on the Form 1099-K. The Form will also include your TIN, name, address, and similar taxpayer reporting information. You can view a Form 1099-K here.
Why is the aggregate annual gross amount of transactions the requirement for reporting?
When the IRS's proposed regulations were first published for comment, many commentators suggested that "gross amount" reported should be the net sales amount because the gross amount does not reflect the actual amount of revenue earned by the third party, or you as the advisor.
However, the IRS reiterated that the aggregate annual gross amount of transactions must be reported because "the information reported on the return required under these regulations is not intended to be an exact match of the net, taxable, or even the total income of a payee."
What is a TIN?
For U.S. taxpayers, a TIN is required by the IRS for the administration of the tax laws. In most cases, your TIN is either an Employer Identification Number (EIN) or a Social Security Number (SSN Accounts with different TINs will be reported separately). For advisors not residing in the US, the IRS regulations generally require non-U.S. taxpayers to provide Form W-8 to KEEN, Ingenio, LiveAdvice and Ether in order to be exempt from U.S. tax reporting requirements.
What if I don't have a TIN (SSN or EIN) on file?
All advisors providing services on KEEN, Ingenio, LiveAdvice or Ether are required to provide a TIN (SSN or EIN) when requesting payment for services rendered.
How do I ensure my TIN information is accurate?
To view or change your TIN information, please login to your account and use one of the payment options available to you (Request Check or Direct Deposit advisor payment pages). For your safety, please do not submit a SSN or EIN via email to Customer Support.
Please note: If you change or delete your payable information throughout the year, this may lead to the account being suspended until it is verified again.
What will happen if I don't provide my TIN?
KEEN, Ingenio, LiveAdvice and Ether, as third-party settlement organizations, are required by law to report total amount of annual gross transactions collected from customers on behalf of advisors on Form 1099-K. Therefore, we may suspend access to your account until your TIN is securely received and verified.
How will I know if my TIN information matches what the IRS has on file?
If we're informed your TIN information does not match IRS records, the Play Fair department will contact you with additional instructions. Due ot the sensitive nature of a TIN, in some instances your account may be temporarily suspended to securely collect necessary details.
Why would information I provide not match the IRS?
We don't know exactly why your tax identity information came back as invalid and did not match, but here are some things to consider:
- If you are completing the tax identity information as an individual, use the information that appears on your Social security card.
- If you are completing the information as a business, use the business name that appears when reporting taxes to the IRS.
- Misspelling your name, not including your middle initial or middle name, or entering an incorrect Tax Identification Number may cause tax identity information to not match to IRS records.
Will all advisors on KEEN, Ingenio, LiveAdvice and Ether receive a Form 1099-K?
Absent changes in the laws, if you had at least $20,000 in aggregate annual gross transactions AND 200 or more paid transactions, we will be required to report the total transaction amount in aggregate by month collected from customers on the advisor's behalf (unadjusted for any fees or commissions) on Form 1099-K. If you did not meet both of these thresholds, Form 1099-K reporting will not be required.
Will I be able to verify what is being reported online via my KEEN, Ingenio, LiveAdvice and Ether account?
We're in the process of updating the information displayed to advisors related to payment. This information should be available by mid-January through KEEN, Ingenio, LiveAdvice and Ether websites. We'll update advisors when we have more details.
Will any information about each individual transaction be given to the IRS?
No. The Form 1099-K rules only require that aggregate gross amount of transactions for the calendar year and the monthly aggregate gross amount of transactions to be reported. Accordingly, individual transaction level details are not reported to the IRS.
What about fees and expenses incurred to run my business through KEEN, Ingenio, LiveAdvice and Ether?
The new reporting rules have not changed advisors' ability to deduct their ordinary and necessary business expenses from their taxable income, and KEEN, Ingenio, LiveAdvice and Ether fees, commissions and other charges will often represent such deductible expenses. Advisors should, of course, consult with their personal tax advisor to make sure that they handling these items correctly under their personal circumstances.
Can KEEN, Ingenio, LiveAdvice or Ether help me with my tax return?
We recommend you contact a professional tax advisor to understand the general reporting rules for Form 1099-K, as we cannot provide any tax guidance specific to your individual circumstances.
When can I expect to receive the Form 1099-K if my account is subject to the reporting rules?
If eligible and a form 1099-K was filed on your behalf, the form will be postmarked on or before January 31 of the following year and will be mailed to the address provided by you when submitting your advisor payment information.
What if I have other questions not listed here?
We'll continue updating this help page as we have more information. If your question is not listed above, please contact Customer Support.
Please note: We would like to emphasize again that the new IRS reporting rules may have a direct impact on your income tax situation and we strongly recommend that you consult your own tax, legal, or other professional advisor if you have questions about how these new laws may or may not affect you or your business.