Student Loan Debt has been in the news again. Additionally, there is an update regarding 1099-K filing rules. Let’s review the updates today.
Image by Mohamed Hassan from Pixabay
Student Loan Debt Update
Because of lawsuits filed by the American Federation of Teachers, the Education Department said it would continue processing debt relief for loan borrowers on income-driven repayment plans.
Those who will benefit from IBR plans resuming are borrowers who have been enrolled in a plan for 20 or 25 years and have made the necessary payments determined when they signed up for the loan. The Department of Education will send emails to qualifying borrowers detailing the next steps.
On average, the cancellation will take effect two weeks after the Department of Education sends the email notice. Depending on how many people qualify, processing times may be longer.
Fast Company reports that while a formal notice is the best way to confirm that your federal student loan debt will be canceled, here’s how to know if you may qualify.
BORROWERS MUST BE ENROLLED IN IBR PLAN
The forgiveness notices sent out in recent weeks are only going to student loan borrowers who are enrolled in the Income-Based Repayment plan, which caps monthly payments at a certain percentage of borrowers’ discretionary income.
Borrowers enrolled in other repayment plans, even other income-driven repayment plans, may not see relief soon—if ever. That’s because other plans have been phased out or are being held up by litigation in courts.
CHECK NUMBER OF LOAN PAYMENTS
Only those borrowers enrolled in an IBR plan who have made a sufficient number of loan payments are eligible for forgiveness.
If you took out your federal student loans before July 1, 2014, then you must have made consistent monthly payments—300 in total—for 25 years. If you took out loans after that date, the threshold drops to 240 payments over a 20-year period.
Many borrowers switch repayment plans over time—and you may still be eligible for IBR forgiveness for payments made while you were enrolled under other plans.
It may be tempting to assume you’ve qualified for debt forgiveness based on your records of payments, but you should continue making payments as normal until you receive official notice.
Under the agreement, the department will also continue processing buybacks for the Public Service Loan Forgiveness program, allowing loanees to “buy back” periods of time spent in deferment or forbearance if it would permit them to reach their payment threshold for debt forgiveness.
Image by Gerd Altmann from Pixabay
1099K Filing Update
Saving Advice has a good write-up about the filing update. The IRS delayed its $2,500 reporting threshold and announced a return to the $20,000 and 200 transaction limit for 2025.
Form 1099-K reports payments received through third-party platforms like PayPal, Venmo, eBay, Cash App, or Etsy for goods and services. Under the 2025 delay, platforms only need to issue a 1099-K if you earned more than $20,000 and had over 200 transactions.
This threshold sounds generous—but it’s a reporting rule, not a tax exemption. The IRS still expects you to report all taxable income, even if you never receive a form. That’s where most sellers get caught off guard.
Many casual resellers assume the $20K/200 rule means they can safely ignore taxes on smaller sales. But if you flip collectibles, resell furniture, or run side gigs—even below that level—you’re still legally required to report profits.
The IRS doesn’t care whether you receive a 1099-K; it cares whether you earned taxable income. The delay only affects who sends the form, not who owes taxes. If you made $5,000 in profit from online resales, you’re still on the hook.
Even if you don’t receive a 1099-K, the payment platforms still record and store your transaction history. When the threshold eventually drops again—possibly as soon as 2026—those records will already exist.
That means today’s sales could be reviewed retroactively if audits or reporting discrepancies arise. It’s smart to separate personal and business accounts now and label every payment correctly (“friends and family” vs. “goods and services”). That paper trail can protect you later.
Many sellers who earned a few thousand dollars this year may assume they’re “too small to matter.” But the IRS has multiple data points—like eBay, Shopify, and payment app logs—that still capture income.
If you don’t report it and they flag a mismatch later, you could face penalties and back taxes. The 1099-K form makes tracking easier for them—it doesn’t create or erase your tax liability.
Even if you stay under $20,000, doing more than 200 small transactions can still trigger a 1099-K, depending on the platform. For resellers who flip low-cost goods like clothes, collectibles, or vintage items, that’s easy to hit.
For example, 220 $15 sales = $3,300—and a 1099-K form. So while the dollar amount sounds high, the transaction count catches smaller sellers fast. Keep an eye on your sale volume—not just revenue—to avoid surprise paperwork.
Whether or not you receive a 1099-K, you’re still responsible for accurate records. Keep receipts showing what you paid for items, shipping costs, fees, and selling prices.
If you sell something for less than you bought it, it’s generally not taxable—but you’ll need documentation to prove it. Without proof, the IRS assumes full income and may tax the entire amount. Think of receipts and spreadsheets as insurance against future headaches.
The IRS isn’t abandoning its lower threshold plan; it’s just phasing it in slowly. Officials have stated they expect to implement a smaller limit—likely between $2,500 and $5,000—after more platform adjustments.
The goal remains increased transparency and compliance for digital payments. Sellers who prepare now will adapt easily when that happens. Those who ignore it could face a painful learning curve once smaller transactions are automatically reported.
Little Things Make a Difference
Staying on top of updates that may impact you, your family, and your work is crazy, I understand. It’s why I try to relay information weekly for you.
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