IRS Publication 5731-B – IRS Forms, Instructions, Pubs 2026 – In today’s gig economy, many people are earning extra income by selling goods online or providing services through apps and platforms. But how do you know if that side hustle income is taxable? IRS Publication 5731-B, titled “Are You Making Money Selling Things or Providing a Service?”, is a key resource designed to help individuals navigate these questions. Released in its latest revision in November 2025, this publication focuses on Form 1099-K reporting and emphasizes the importance of understanding your tax obligations. Whether you’re reselling items on eBay, driving for a ride-sharing app, or freelancing on Upwork, this guide breaks down what you need to know to stay compliant with IRS rules.
What Is IRS Publication 5731-B?
IRS Publication 5731-B is a concise brochure from the Internal Revenue Service aimed at educating taxpayers about income from selling goods or providing services, particularly in the context of electronic payments. It’s especially relevant for those involved in the gig economy, online sales, or small business activities. The publication explains that if you’re receiving payments through credit cards, debit cards, gift cards, or third-party apps, you might get a Form 1099-K, which reports these transactions to both you and the IRS.
The document stresses that all income is taxable unless specifically excluded by tax law, even if you don’t receive a Form 1099-K. It’s available in multiple languages, including Spanish and Chinese-Simplified, making it accessible to a broader audience. As of its November 2025 update, it aligns with current reporting thresholds and encourages proper recordkeeping to simplify tax filing.
Who Should Read This Publication?
This publication is ideal for anyone earning money through:
- Side hustles like selling handmade crafts on Etsy or vintage items on Facebook Marketplace.
- Providing services via apps such as Uber, DoorDash, or Fiverr.
- Online platforms where payments are processed electronically, including Amazon, PayPal, or Stripe.
If you’re unsure whether your activity counts as a hobby or a business, Publication 5731-B implies that receiving commercial payments (especially those triggering a Form 1099-K) often indicates business-like activity that requires income reporting. It’s particularly useful for gig workers, freelancers, and small sellers who might not realize their earnings could lead to tax liabilities.
Understanding Form 1099-K: Reporting Thresholds and Requirements
Form 1099-K is central to Publication 5731-B. You’ll receive this form if your payments for goods or services exceed $20,000 and involve more than 200 transactions through a payment app or online marketplace (known as third-party settlement organizations or TPSOs). However, if you accept direct credit, debit, or gift card payments, you’ll get a 1099-K regardless of the amount or number of transactions.
The form reports the gross amount of payments, not your net profit. It’s your responsibility to use it alongside your records to calculate taxable income. Examples of platforms that issue 1099-Ks include ride-hailing apps, auction sites, crowdfunding platforms, and freelance marketplaces.
Here’s an example of what Form 1099-K looks like:
Remember, even without a 1099-K, you must report all business income on your tax return.
What Income Is Taxable When Selling Goods or Providing Services?
According to the publication, the profit from your activities is what’s taxable. This includes:
- Gains from selling personal items (e.g., clothing or furniture) at a profit.
- Earnings from services like tutoring, graphic design, or delivery gigs.
All income is presumed taxable unless the law specifies otherwise. For instance, if you sell items online and make a profit, that amount must be reported, regardless of the scale of your operation.
What Income Is Not Taxable?
Not everything reported on a 1099-K is taxable. Personal payments, such as:
- Gifts from family or friends.
- Reimbursements for shared expenses (e.g., splitting dinner costs or roommate bill repayments).
- Birthday or holiday money.
These should not trigger a 1099-K, and if they do by mistake, mark them as “personal” in the app to avoid issues. The IRS warns that inaccurate 1099-Ks can complicate things, so verify and correct them promptly.
Recordkeeping Tips for Gig Economy and Side Hustle Taxes
Good recordkeeping is a cornerstone of Publication 5731-B. Keep detailed tracks of:
- Expenses related to your sales or services (e.g., materials, mileage, fees).
- What you’ve sold or services provided.
- All payments received throughout the year.
Separate business and personal transactions to make tax time easier—use dedicated accounts or apps for this. This helps when deducting expenses and proving non-taxable items.
How to Report Your Income on Your Tax Return
Use Schedule C (Form 1040) for business income and expenses if your activity qualifies as a business. Report profits as self-employment income, which may also subject you to self-employment taxes. Consult a tax professional if you’re unsure, especially for platforms like Etsy or Amazon.
If you receive an incorrect 1099-K, visit IRS.gov/1099khelp for guidance on corrections.
Additional Resources and Myths Busted
The IRS busts common myths in related materials: Receiving a 1099-K doesn’t mean everything is taxable—it’s about your net profit. For more, check Publication 5951, “IRS Form 1099-K MYTHS vs FACTS.”
Visit IRS.gov/1099K for in-depth info, or download the full Publication 5731-B PDF from the official IRS site. If you’re preparing your 2026 taxes, these tools can help avoid surprises.
In summary, IRS Publication 5731-B is an essential read for anyone making money selling things or providing services in 2026. By understanding Form 1099-K and maintaining solid records, you can ensure accurate reporting and minimize tax headaches. Always consult IRS resources or a tax advisor for personalized advice.