TAX002 - Tax information for the USA

Modified on Thu, 20 Feb at 9:11 AM

If you reside in the USA, we will make available an online downloadable 1099-K for individuals and a downloadable file for companies listing all the contributing transactions on Jan 1 of the previous year. You should then submit these documents with your tax returns in the usual manner. Please note you do not need to submit paperwork to XTRM, such as an I-9 form.

Individual accounts - Your XTRM Identity must be at 100% complete IDL (Identity Level) to access and download the document. More Info

We need to collect:

SSN/Tax ID
Physical address
Full Name
DOB (date of birth)
Email
Mobile number

Money paid into a wallet is owned by the wallet account owner and is considered paid by the IRS regardless of whether it has subsequently been transferred to a bank, a check, a gift card, or any other transfer option.

How will I receive a 1099-K, and what do I do with it?

Your 1099-K will be displayed in your account for download at the beginning of the year—log into your account to retrieve it. The 1099-K is a purely informational form that summarizes the payment activity of your account and is designed to assist you in reporting your taxes. Please make sure your profile is up to date, as the tax form is pre-filled using your profile data. We store all your data securely and do not share it. Every year, the United States IRS requires that XTRM provide you with a completed form called a 1099-K for each account that meets all of the following criteria in the previous calendar year:

Will I have to pay taxes sending and receiving money and what is the thresholds?

Will I have to pay taxes when sending and receiving money on XTRM?

The Internal Revenue Service (IRS) announced transitional reporting requirements for payments received for goods and services. These requirements will lower the Form 1099-K reporting threshold over a 3-year period from the previous threshold of more than $20,000 in goods and services transactions and more than 200 goods and services transactions in a calendar year. We’ve summarized the IRS thresholds for the 1099-K form below.

Tax Year	Available In	Federal Reporting Threshold
2024	2025	More than $5,000 USD in gross sales from goods or services in the calendar year.
2025	2026	More than $2,500 USD in gross sales from goods or services in the calendar year.
2026	2027	More than $600 USD in gross sales from goods or services in the calendar year.

Here’s more details on the 1099-K threshold change:

This new threshold change is only for payments received for goods and services transactions, so this doesn’t include things like paying your family or friends within your XTRM wallet.
This change was introduced by the American Rescue Plan Act of 2021, which amended some sections of the Internal Revenue Code to require third party payment processors to report transactions paid to account holders with $600 USD or more in annual gross sales on Form 1099-K. Previously, a 1099-K was only required when a user received more than $20,000 USD in goods and services transactions and more than 200 goods and services transactions in a calendar year. To implement this new $600 threshold, the IRS is phasing in the requirement by reducing the federal reporting threshold over a 3-year period.
This reporting is required when the sender identifies the transaction as being for goods and services, even if it was a mistake. Although this transaction is reportable by XTRM, it’s possible that the transaction is not taxable. It’s always best to speak with a tax professional for any specific concerns you may have.

You can download your 1099-K in the Tax section of your account. We provide the 1099-K to every person and company regardless of their earnings and direct them to the IRS.

**Ensure your Tax ID is on the document prior to submission to the Tax Agency. If it does not appear, please update the tax id in the Identity Section and download the document again

Example 1099-K

What information is included in my 1099-K?

Below you’ll find a brief description of the information you can expect to find on the 1099-K that XTRM provides for you. For more help understanding your 1099-K, go to IRS.gov.

Label	Box #	Description
Filer’s name, address, and telephone number		Contact information for XTRM
Payee’s name, address, and telephone number		This is the contact information for your business or organization as it was provided to XTRM. If you’d like to update your address, please do so before January 21st from your account settings.
PSE’S name and telephone number		Contact information for XTRM
Account number		Your XTRM account number
Filer’s federal identification number		XTRM’s identification with the government
Payee’s taxpayer identification number		This is either your Employer Identification Number (EIN), Social Security Number (SSN), or Tax ID as it was provided to XTRM. If your information needs to be updated, please correct it in your profile.
The gross amount of payment card third-party network transactions	1a	The total gross volume of charges that you’ve made with XTRM in the calendar year
Card Not Present transactions	1b	The total gross volume of charges made without the card present at the time of the transaction.
Merchant category code	2	The merchant category code for your business or organization
Number of payment transactions	3	The number of charges that you’ve made with XTRM in the calendar year
Federal income tax withheld	4	Backup withholding from your XTRM payments.
	5a-5l	The total gross volume of charges that you’ve made with XTRM for each month of the calendar year
State	6	The state in which your income tax has been withheld
State identification number	7	Your identification number that is used for your state income tax withholding
State income tax withheld	8	State and local income tax withheld from the payments

How and when do I get my 1099-K?

Your 1099-K is available for download on January 1st and beyond each year as long as your profile is complete. To view and download, log in to your account.

Click the Tax menu item on the left menu.
Click on the Download 1099-K button to download

What is “Total Gross Volume”?

“Total gross volume” means that we calculate the total of all of your payments received for the year, including:

Payments from companies
All adjustments

Finding out the transactions counted towards your 1099-K

If you’d like to see a per-transaction breakdown of your 1099-K, you can easily do so by logging into your XTRM account and then viewing the Tax page.

From here, select the Download Transaction Details button located in the upper-right corner of your screen.
After the download has finished, open the resulting .csv file in your spreadsheet viewer of choice.

My account received less than the US IRS reporting threshold, but I still received a 1099-K. Why is that?

XTRM provides a 1099-K form for all USA residents regardless of the actual requirements and thresholds.

1099-Misc versus 1099-K

If you earn over $600, you may be sent a 1099-Misc as well as a 1099-K to submit with your Tax Return. You do not need to submit both.

Why do we require some personal information?

Social Security Number (SSN -part of the profile) is required by XTRM for a few reasons based on typical financial security regulations, KYC, and AML for money movement and tax documentation. This is standard. For example, a completed profile is required to increase transfer limits (daily/monthly) and tax documents. We require users to complete their profiles to be able to complete those tasks. We recommend users send in their 1099-K regardless of the amount received, although the stated amount is currently $600 in the US.