Update on Paypal and Taxes- 1099s

[Nickinator]

UPDATE:

Had started another thread earlier on the "new" tax system at PP- as I'd spoken with 3 reps and got 3 slightly different versions, but all had said that F&F and transfers were counted towards Gross sales...the thread was getting confusing with all the updates, so I had a Mod take it down.

I have since spoken to someone in their actual tax dept, and can confidently say that no changes have been made to the way PP sorts and reports transactions since 2011- ONLY those transactions which are marked as Goods, Services and Donations are counted towards your Gross.

And if those #'s are below the 200 transactions AND 20k in Sales (have to meet both to get a 1099), no 1099 will be generated for the IRS. So getting a refund from Target won't count, adding money with a PP cash card won't count, F & F won't count, transfers won't count.

And just FYI- if you do accidentally get a 1099k and your records are different, you can dispute it, and an updated one will be sent to the IRS. You would know sometime around the end of January if one was going out.

Can't believe how many people at Paypal had the wrong info on this...

Darcie

 

[bricycle]

Thanks, Great info!

 

[Jesse McCauley]

Ohhhhh good, had me worried


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[Dan the bike man]

Good info. I just buy. No selling.

 

[Waterland]

I don't understand any of what you just said. If I sell on ebay, does that mean the IRS is going to send me something saying I need to pay in and claim my Ebay sales as taxable income?

 

[Freqman1]

I don't understand any of what you just said. If I sell on ebay, does that mean the IRS is going to send me something saying I need to pay in and claim my Ebay sales as taxable income?

Here's the short version the way I understand it; if you have 200 or more transactions AND $20k or over on sales generated from Good & Services or Donations you will receive a 1099 that you will have to file. V/r Shawn

 

[catfish]

Thank you very much for looking into this. Great info!

 

[Flat Tire]

If you want to know anything about PayPal rules, policy, or legal info all you have to do is log into your PayPal account. You can click on Legal and Policy Updates at the bottom of the page, if they change their policy on anything you will get an email.
Really quite simple.

 

[Nickinator]

If you want to know anything about PayPal rules, policy, or legal info all you have to do is log into your PayPal account. You can click on Legal and Policy Updates at the bottom of the page, if they change their policy on anything you will get an email.
Really quite simple.

Except for determining what is specifically is counted as Goods or Sales, which is not addressed on their site.
And if you call PP to ask for this info, you will likely be told something incorrect. That was the point of the thread.

Also if you have a business account, you can check your #'s online, but it will show you the total of transactions that counts everything, not just those specifically coming in as Goods, Services and Donations. So you can't rely on those figures. If you want to know the actual transaction # or what's being counted in your Goods and Sales, you'll have to call and talk to someone in their tax dept. Certainly could have a better online accounting system for their users.

Darcie

 

[Major Taylor Archive]

I live in Massachusetts and received a 1099-k. MA and VT recently changed the law stating that anything over $600. is now reported to the IRS. Since I had approx. $3500. in sales and 89 total transactions (well below the $20k/200 transaction IRS threshold) I believe I only have to claim in on my state taxes. I need to do more research. I called PayPal but they refused to tell me who I had to file with since they are not tax consultants. Kind of BS since they were the one's issuing a tax document. Stay tuned....