eBay Mistakenly Issues 1099-Ks To Individual Seller Names, Not LLCs
eBay community staff received multiple questions about this issue in this week's chat session all about 1099-K forms.
Their official answer is:
For the 2022 Tax year, we have aligned issuing 1099Ks to IRS standards for Sole-Prop and Single Member LLC requirements. The IRS requires that Sole Props and Single Member LLCs file returns using the SSN of the owner, not the EIN of these entities. More information on this can be found here.
One seller pointed out that the guidelines from the IRS provides and exception for those who file form 8832 and elect to be treated as a corporation, asking if eBay will accomodate those sellers - but they did not get a response.
"...unless [the entity] files Form 8832 and affirmatively elects to be treated as a corporation".
Does eBay accommodate this filing? Or is this a Customer Support manual override?
Another seller says they believe the issues stem from the previous way eBay had coded the business details page for accounts, which if true, eBay absolutely should be providing a way for sellers to correct.
There has been a controversy in last several days about use of EIN on the 1099-K. Ebay apparently is refusing to put EIN on 1099-K even for sellers that are LLC and do NOT file on their personal return. The back and forth and (closed) tickets with eBay on this matter has been inconsistent.
Back when I signed up there was no difference between sole proprietor and LLC they were all lumped together in a single category and all people who entered EIN and business name got their 1099-K accordingly.
Well.. recently eBay CHANGED the sign up process and now when you create a new account you are lead down different paths for Sole Priority versus LLC and a choice is offered during registration to use EIN if appropriate for your LLC.
But.... people who had /have the old combined Sole P / LLC designation on their account are stuck and can NOT get a 1099-K with EIN. In my opinion this is a missed factor in migration when the taxation categories changed.
So... the only way I can see to get LLC EIN on 1099-K is to create a brand new account re-register with the NEW LLC path that allows EIN. We are not being allowed to change over if we are stuck with the old combined Sole P /LLC showing on our business information page.
The IRS guidelines are being mis-quoted by agents. The rules are clear to me that and EIN should be allowed for some LLCs and only the business owner know how they file.
The entry for ALERT14445 was also simply deleted from the ongoing technical issues post in the community with no explanation or resolution, indicating this was never actually a technical issue and the information provided by eBay reps say it was a technical issue was just completely wrong.
If eBay cared at all about transparency, at a bare minimum they should have moved that alert to the "resolved" section of the ongoing technical issues post with a correction/acknowledgement that it was an intentional change, not a technical issue.
Instead they simply deleted it and hoped nobody would notice. 🤦♀️
Sellers in the eBay Community were befuddled to receive 1099-K forms for tax year 2022 with their individual name and social security numbers listed instead of their LLC business name and EIN.
Just found that eBay sent 1099K to the sole shareholder's SSN. But the company is elected as S crop tax purpose under EIN. I contacted eBay and it said they will update my EIN and send a new 1099 form. But the possible problem is that I believe that the original 1099K under SSN has been possibly transmitted to IRS. I asked if they can generate a "corrected" version of 1099K with all zeros under SSN and send it to IRS. They said they can only issue a new 1099K under company's EIN. I am not sure if the new 1099K info will be transferred to IRS.
I am having the same issue. Just found out yesterday that the 1099-K was issued under my SSN instead of my LLC, S CORP'S EIN. I called eBay right away. The support agent told me it could take 3 days for the responsible department to get back to me and then another 7 days for the new 1099-K to be updated.
Got wrong issued 1099 K on my name. Not on my LLC. Nothing was changed last 3 years in account. Customer Service Representative said that it was bug. But no timeframe when it gonna be fixed. AMAZING. I'm requesting URGENT manually correction !
Hello. I have the same problem. eBay send 1099k to the sole shareholder's SSN, not the company's EIN (S crop). I contacted eBay last night and it told me they will put a request to update my EIN and send a new 1099K under the EIN. Are you a single member LLC?
Unfortunately, once again it looks like eBay support is handing out bad information that could have calamitous results for sellers.
This seller was originally told by support that there had been a change in IRS requirement, the 1099-Ks were correct and would not be changed:
Just tried to call and add Reference ID: ALERT14445 to my case. CS said that they got answer fro IRS and from this year IRS require to send 1099-K on personal name and SSN of the account owner and Stakeholder/Beneficial owner. So, 1099k will be not corrected as it's IRS guides. Please try to call eBay today and share your experience from different CS.
However, when one of the eBay community reps was asked to verify that information, they said it was incorrect and told the seller to reach back out to support.
This information that was shared would be incorrect and I recommend to reach back out to customer support to have their account added to the ticket if they are running into this issue.
However, more sellers reported receiving the same incorrect info from support subsequently and we're still waiting for Devon@eBay to respond in the community after promising to follow up with a specialist.
In the meantime, a ticket about this issue has been created and posted in the ongoing technical issues section of the community.
1099K issued under SSN rather than the EIN and business name (February 1, 2023)
Reference ID: ALERT14445
Provide Member ID:
Did you receive a 1099-K from eBay with your SSN instead of EIN? Let us know in the comments below!