Since Grubhub receives funds from customers and transmits these funds to your restaurant, the IRS considers Grubhub a Third Party Settlement Organization (TPSO). As stated by the IRS, “Every PSE or other party which submits instructions to transfer funds to the account of a participating merchant, in settlement of reportable payment transactions, must file an information return (Form 1099-K) with respect to each participating payee for that calendar year.

To learn more about 1099-Ks, please read our article Understanding Your 1099-K.