Reconciling your 1099-K in SellerTally

This is the practical companion to Understanding your Amazon 1099-K. That article explains why the number on the form looks wrong. This one walks through actually reconciling it, month by month, and — just as importantly — tells you when a difference is expected and you should stop looking.

Before you start

You need the year’s Amazon data imported. A month you never imported will show as zero in every box for that month, which looks alarming and means nothing except that a file is missing.

Check first: on the Amazon import screen, look at the list of uploaded files and confirm you have one for every month of the tax year. Twelve months in, twelve months listed.

You’ll also want your actual paper 1099-K next to you — the report doesn’t take it as an input, it’s built for you to compare against it by eye.

Step 1 — run the report

Go to Reports → 1099-K Reconciliation, choose the Tax Year, and run it. You get one row per month, laid out the same way Amazon’s own form is — a Box 3 row (number of payment transactions for the year) at the top, then one row per month labelled the way the form labels them (Jan is box 5a, Feb is 5b, and so on through Dec at 5l), then a Grand Total row that matches box 1a. The columns are the same six components the form’s own formula adds together: Product Sales, Shipping Credits, Gift Wrap Credits, Promotional Rebates, Sales Tax Collected, and PYOP, plus the Unadjusted Gross Sales those six sum to.

Compare each month’s Unadjusted Gross Sales figure against the corresponding box on your paper form. They should be close. They will rarely be exactly equal, for the reasons below.

Step 2 — decide whether a mismatch needs you

Exactly equal, or off by a few cents. Nothing to do — that’s rounding.

December and January are both slightly off, in opposite directions, and everything else matches. This is the expected timing difference and it is Amazon’s documented behaviour: the form reports on the transaction date, while SellerTally’s own figures are built from the same settlement data you imported. Orders placed at the end of December and settled in January can land in different years on the two documents. Stop here. Note it for your accountant and move on — this one never resolves, because there is nothing wrong with it.

One mid-year month is at or near zero when your form shows real activity. That month was not imported, or was imported and later deleted. Go back to the import screen and check.

One mid-year month is roughly double what your form shows. The same month was imported twice. SellerTally blocks duplicate months by period, so this is rare — but if the same data arrived under two different periods it can happen.

Anything else. Look at which of the six columns the gap is actually in — that usually points straight at the cause:

• Product Sales — the largest component, and the one where a genuine timing difference shows up first. A small difference here at the year boundary is normal.
• Sales Tax Collected — a mismatch here often means marketplace-facilitator tax. In most states Amazon collects and remits sales tax on your behalf; whether a particular state’s amount is inside your figure can shift when a state changes its rules mid-year.
• Promotional Rebates — this one is subtracted in the formula. A sign error anywhere upstream shows here as a gap of exactly twice the rebate total, which is a useful fingerprint.
• Shipping Credits / Gift Wrap Credits — usually small. A gap here that is large relative to the component is almost always a missing month rather than a real discrepancy.
• PYOP — “Paid You, Owed Product”. Frequently a small, non-zero figure, sometimes zero.

Step 3 — know when to stop

The 1099-K reconciliation has a natural floor. Because the two documents can use different dates by design, a residual gap of a fraction of a percent, concentrated at the year boundary, is the correct answer, not a failure to finish the job. Chasing it to zero is not possible and not worth the hours.

What matters at filing time is that you can explain the gap — which month it is in, which column it is in, and why. This report exists to let you say exactly that in one sentence.

What your accountant will ask for

• The 1099-K itself.
• Your Profit & Loss for the year — the number that reflects what you actually earned, after fees, refunds and cost of goods.
• The 1099-K Reconciliation report, exported — the month-by-month bridge to the form.

If the report shows the December/January timing difference described above, say so up front. It is the first thing they would otherwise ask about, and every Amazon seller has it.

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This article explains how to use SellerTally’s reports. It is not tax advice — for how any of it applies to your return, ask your accountant.