Paypal/Electronic payment rules from the IRS

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sm2501

CABE owner
System Administrator
I know there has been some discussion regarding Paypal, 1099's and friends and family payments. Here is an email that I just received from Paypal.


Tax rules have changed​

We’ve got you covered with all the details:​

Beginning January 1, 2022, the IRS implemented new reporting guidelines for individuals receiving goods and services payments on PayPal and other platforms totaling $600 or more per year.​

So what exactly does this mean for you?​


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Well, if you’re getting payments from friends and family members, this won’t apply (lucky you!). Friends and family payments are things like splitting a bill, sharing apartment expenses, or paying back friends. None of these are reported.​

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The new tax requirements only apply to goods and services payments. These transactions are tagged in the app by a buyer, indicating they’re purchasing something like a couch from a seller. Payments received by a Seller Profile are also goods and services payments.​

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If you receive over $600 in goods and services payments, we’ll automatically keep track of these payments and provide you with a 1099-K form at the end of the year. If your tax info is not complete, we’ll reach out to you with instructions.​
And remember, this only applies to receiving goods and services payments. Payments that you send are not reported.​
 

Frosty

Finally riding a big boys bike
Making it really hard for people to sell stuff. It's crazy you're going to have to pay income taxes on selling off your items that you spent your income on that you were already charged income tax for.
 

Archie Sturmer

Riding a '38 Autocycle Deluxe
we’ll automatically keep track of these payments and provide you with a 1099-K form
So, it's like an honor system, and they don't actually report to the bad guys, (or do they forget to mention)?
 
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GTs58

I'm the Wiz, and nobody beats me!
When issued a 1099 from someone (Contractor) that paid you for doing a job for them, they will also send the info to IRS so they are not liable for the taxes on that cash that was given to you for doing the job. Can you image the headache for the IRS if eBay sends them millions of these 1099 records to process? 😂
 

rustjunkie

. . . . . . .
Moderator
When issued a 1099 from someone (Contractor) that paid you for doing a job for them, they will also send the info to IRS so they are not liable for the taxes on that cash that was given to you for doing the job. Can you image the headache for the IRS if eBay sends them millions of these 1099 records to process? 😂

it's automated:


 

hzqw2l

Wore out three sets of tires already!
Everybody is a business now. We can't have anyone being a flea market flipper to make a few extra $ to support their hobby anymore.

Used to be a state government issue. Now the bright bulbs we elect want it all to be federal.

Next it will be ... Wow you have alot of friends that you send money to with our service....

Country isn't free anymore. You have to pay.
 
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