1099-K Reconciliation

Amazon's 1099-K reports gross sales, including refunds and before fees. Most sellers look at their bank deposits, see a much smaller number, and either overpay tax or underreport. This skill reconciles the two and produces the worksheet that maps to Schedule C lines.

When to use this

• Year-end tax prep and the 1099-K does not match the deposits.
• Working with a CPA who needs the breakdown.
• A first 1099-K and the seller is confused by the gross number.
• Quarterly estimated taxes and the seller wants to know the real revenue.

The framework. The Gross-to-Net Bridge

The 1099-K shows one number: gross sales. The bank shows another: net deposits. The bridge between them is: