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Cash App users could see a Form 1099-K this tax season, which reports business payments to the IRS and state authorities. Following the passage of the One Big Beautiful Bill Act (OBBBA) in July 2025, the federal reporting threshold reverted to more than $20,000 and 200 transactions \u2014 a threshold that had been in place prior to the American Rescue Plan Act of 2021.<\/p>\n
If you used Cash App, PayPal, or Venmo for freelance or self-employment income in 2025, these transactions qualify as taxable income. While personal transfers remain exempt from reporting, you\u2019re legally required to report all business earnings on your tax return, even if you don’t receive a 1099-K.<\/p>\n
Let\u2019s take a closer look at recent changes to income tax rules that might leave you on the hook for Cash App taxes.<\/p>\n
Read more: <\/em>How to file your taxes for free<\/em><\/p>\n The answer: It depends.<\/p>\n If you use Cash App to send money to friends and family \u2014 reimbursing split costs, for example \u2014 those types of transactions do not have to be reported.<\/p>\n The reporting requirements apply to money you make selling goods or services paid to you via the app.<\/p>\n If you have a business account with Cash App and your transactions meet the reporting threshold for the calendar year (for the 2025 tax year, it\u2019s $20,000), you should receive a 1099-K form from Cash App for tax reporting purposes. Cash App is also required to send this tax information to the IRS.<\/p>\n Keep in mind that small business owners, self-employed contractors, and freelancers alike are required to report payments for goods and services directly to the IRS to determine liability for federal and state taxes. And while some transactions in your business account may actually be personal payments and exempt from IRS rules on income reporting, they\u2019ll still show up on your tax documents from Cash App.<\/p>\n Here are a few scenarios to help you determine which types of payments fall under IRS rules for income reporting and which ones you can exempt. When in doubt about which transactions fall under the tax law, it\u2019s always best to consult a tax professional or certified public accountant (CPA).<\/p>\n Examples of business transactions:<\/strong><\/p>\n Receiving payment for cleaning, food prep, or other professional services<\/p>\n<\/li>\n Being paid for handmade jewelry or crafts<\/p>\n<\/li>\n Flipping furniture and selling it for a profit<\/p>\n<\/li>\n Earning money for mowing lawns or pet care<\/p>\n<\/li>\n Getting money for providing transportation or delivering meals<\/p>\n<\/li>\n<\/ul>\n Examples of personal transactions:<\/strong><\/p>\n Receiving money for a dinner check you split with friends<\/p>\n<\/li>\n Selling your used couch for less than you paid for it<\/p>\n<\/li>\n Receiving money from your roommate to cover the groceries<\/p>\n<\/li>\n Sending money to your partner for half the month\u2019s utilities<\/p>\n<\/li>\n Getting money to cover the cost of gas or a hotel for a group trip<\/p>\n<\/li>\n<\/ul>\n As you can see from the examples, most transactions you make through your personal account on Cash App that involve family or friends would be exempt from income reporting unless you were acting in a professional capacity. Furthermore, Cash App\u2019s terms of service prohibit using a personal account to accept business payments.<\/p>\n Read more: <\/em>Venmo taxes: IRS rules for payment app transactions<\/em><\/p>\n The reporting rules for payment apps like Cash App changed after the One Big Beautiful Bill Act (OBBBA) was passed in July 2025.<\/p>\n Starting with the 2025 tax year, the federal standard returns to the original, higher bar for \u201cGoods and Services\u201d transactions. Cash App will only send a Form 1099-K to the IRS if your business account exceeds $20,000 in gross payments and more than 200 transactions during the calendar year.<\/p>\n This law also shuts down the IRS plan to lower the reporting requirement to $600 in 2025. Although 2024 used a temporary $5,000 threshold, the OBBBA locks in the $20,000 and 200-transaction rule for 2025 and beyond.<\/p>\n Note that for state returns, some states have instituted their own reporting thresholds that may be lower or different from the federal rules. Before you start tax preparation, consult your state\u2019s website for more information.<\/p>\n Read more: <\/em>How do PayPal taxes work? <\/em><\/p>\n If you had a Cash App business account in 2025 and your total business transactions were $20,000 or more, you should have received a Form 1099-K from Cash App to include with your federal and state tax returns. The form may be sent to you in the mail or via email, or it could be available to download on Cash App\u2019s website.<\/p>\n One tricky part of these reporting obligations is that some taxpayers may have accidentally used business accounts to receive money for the sale of personal items. The IRS website says that while this isn\u2019t ideal, you can handle these transactions in one of two ways: Either report the payment on your federal tax return at the top of Schedule 1 (Form 1040) or report the loss on Form 8949, Sales and Other Dispositions of Capital Assets (you\u2019ll find the specific line on Schedule D, Capital Gains and Losses).<\/p>\n Even if you didn\u2019t receive a 1099-K, you are still required to report all your taxable income received through Cash App and any other payment platforms on your tax return. This would include any business transactions made with credit cards, debit cards, or via other payment platforms that you received in your business or personal account as payment for goods or services you provided.<\/p>\n Failure to fully report your income to the IRS carries various penalties, including an accuracy-related penalty for significant underpayment of taxes and a failure to file penalty for those who might try to skip out on paying taxes altogether. You\u2019ll also accrue interest on the penalties and the amount of taxes due, so it\u2019s best to stay on top of your tax liability and report income accurately up front.<\/p>\n Did you receive a 1099-K form from Cash App in error or with incorrect information? The IRS says to contact Cash App to get it corrected. In the meantime, you can still submit it by making adjustments to your federal and state tax filing to account for personal items sold at a loss or gain.<\/p>\n Cash App doesn\u2019t send a 1099-K to personal account holders. However, Cash App may review and flag transactions in your personal account that appear to be business-related. They\u2019ll usually recommend you open a business account using a different email and phone number from your personal account.<\/p>\n In fact, if it appears that you are continuing to use your personal account to conduct business dealings either as a small business, freelancer, or self-employed contractor, Cash App may lock your personal account entirely for violating its terms of service.<\/p>\n Read more: <\/em>How do self-employment taxes work? A step-by-step guide<\/em><\/p>\n The IRS payment app reporting rules that apply to Cash App are also in effect for other mobile apps that provide peer-to-peer payment services, such as PayPal and Venmo. All of these payment platforms are subject to the same reporting thresholds and are required to issue a Form 1099-K for any potentially taxable income.<\/p>\n One exception to this is Zelle, which no longer offers money transfers through a stand-alone payment platform and can only be accessed through your bank or credit union\u2019s app or website.<\/p>\n Read more: <\/em>Do you have to pay taxes on Zelle transactions?<\/em><\/p>\n Yes, some states have started rolling out their own payment app reporting thresholds, requiring 1099-Ks for state tax filings. For the District of Columbia (DC), Maryland, Massachusetts, Vermont, and Virginia, the 2025 reporting threshold for payment apps like Cash App is $600 or more in business payments within the previous tax year.<\/p>\n For Illinois, the 2025 threshold for payment apps to report business income is $1,000 and at least three or more separate transactions. Missouri sets its reporting threshold at $1,200 for business-related app payments.<\/p>\n The reporting of bitcoin and other cryptocurrency transactions on Cash App is separate from reporting business income. Cash App will provide both you and the IRS with a Form 1099-B that details your bitcoin transactions.<\/p>\n However, Cash App doesn\u2019t include any peer-to-peer transactions involving bitcoin in the 1099-B form, so it\u2019s your responsibility to make sure your tax reporting is accurate. If you have questions about what needs to be reported to the IRS, it\u2019s best to seek tax advice from a professional.<\/p>\n<\/p><\/div>\n\n
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