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Started By
Message
The IRS is coming for your Venmo income
Posted on 6/8/22 at 4:00 pm
Posted on 6/8/22 at 4:00 pm
quote:
Small business owners who use services like PayPal and Venmo for payments previously could, in theory, avoid paying taxes on money earned there if they made less than $20,000.
But a new IRS rule is changing all of that.
quote:
Small-business owners, prepare yourselves for the era of the 1099-K. That’s the tax form for disclosing transactions with services such as PayPal, Venmo, and Airbnb. Until this year, anyone with less than $20,000 in total payments typically didn’t get a 1099-K—and thus, in theory, could avoid paying taxes on money earned on such platforms. But since Jan. 1 those companies have been required to report gross payments of more than $600 directly to the Internal Revenue Service. That means small-business owners—as well as people who periodically empty their closets on EBay—will receive a 1099-K from any service provider where their income exceeds that amount.
LINK
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Posted on 6/8/22 at 4:01 pm to hikingfan
Oh no! Income tax!
For those who can't be bothered to read they aren't taxing your transactions for last weekend's bar tab or the money sent to your sister for mother's day flowers.
For those who can't be bothered to read they aren't taxing your transactions for last weekend's bar tab or the money sent to your sister for mother's day flowers.
This post was edited on 6/8/22 at 5:41 pm
Posted on 6/8/22 at 4:02 pm to hikingfan
If it moves, tax it.
Signed,
The gubment.
Signed,
The gubment.
Posted on 6/8/22 at 4:02 pm to hikingfan
joke's on them.
Posted on 6/8/22 at 4:03 pm to hikingfan
Out of curiosity - How do they know something is a business transaction vs. your friend paying you back for their half of a hotel you booked for y'all or something? Don't a ton of people use Venmo for splitting bills with friends?
Posted on 6/8/22 at 4:03 pm to hikingfan
quote:
avoid paying taxes on money earned there if they made less than $20,000.
we're gonna make sure the 1% pays their fair share
Posted on 6/8/22 at 4:04 pm to hikingfan
quote:
Small business owners who use services like PayPal and Venmo for payments previously could, in theory, evade paying taxes on money earned there if they made less than $20,000.
Fixed the article for the retarded author
Posted on 6/8/22 at 4:05 pm to LouisianaLady
There is a 20k limit.
If you busting the limit becomes a serious issue, and you are too ignorant to figure out the other 50 apps available, then you deserve to pay the tax.
If you busting the limit becomes a serious issue, and you are too ignorant to figure out the other 50 apps available, then you deserve to pay the tax.
Posted on 6/8/22 at 4:05 pm to fightin tigers
quote:
Oh no! Income tax!
Posted on 6/8/22 at 4:05 pm to hikingfan
I hated when they included this crap during whatever stimulus package it was.
$600 per year is such a ridiculously low amount to require reporting. I no longer buy and resell used stuff any longer due to this crap.
$600 per year is such a ridiculously low amount to require reporting. I no longer buy and resell used stuff any longer due to this crap.
Posted on 6/8/22 at 4:06 pm to SECdragonmaster
quote:
If it exists, tax it.
Signed,
The gubment.
Fixed
Posted on 6/8/22 at 4:06 pm to hikingfan
Is this surprising considering that the IRS has nearly doubled in size with the Brandon Administration
Posted on 6/8/22 at 4:06 pm to LouisianaLady
quote:
Out of curiosity - How do they know something is a business transaction vs. your friend paying you back for their half of a hotel you booked for y'all or something? Don't a ton of people use Venmo for splitting bills with friends?
There is a way of sending money to "friends and family" versus to pay things. PayPal has this option as well as Venmo. Sending to friends and family won't have any type of selling protection.
Posted on 6/8/22 at 4:07 pm to LouisianaLady
quote:
Out of curiosity - How do they know something is a business transaction vs. your friend paying you back for their half of a hotel you booked for y'all or something? Don't a ton of people use Venmo for splitting bills with friends?
Venmo is only counting transactions marked as goods or services.
PayPal, I'm not sure.
Ebay is obviously selling goods so you'll need to show your expenses should you be audited.
There's no new tax here, it's just leering the documentation thresholds to try to increase compliance, but the IRS has as much as said they don't have the ability and won't be enforcing this.
Posted on 6/8/22 at 4:07 pm to hikingfan
The one competent arm of the federal government.
Posted on 6/8/22 at 4:08 pm to Mingo Was His NameO
quote:
but the IRS has as much as said they don't have the ability and won't be enforcing this.
Sort of like your HSA accounts.
Posted on 6/8/22 at 4:08 pm to fightin tigers
quote:
There is a 20k limit.
If you busting the limit becomes a serious issue, and you are too ignorant to figure out the other 50 apps available, then you deserve to pay the tax.
It is now $600 per selling place. On any platform. On ebay if you sell $600 you have to fill out a form and report. On mercari if you sell $600 you have to fill out a form.
Not everybody selling small items around the house are trying to make profits/running some business. This is so stupid to have to deal with.
This post was edited on 6/8/22 at 4:10 pm
Posted on 6/8/22 at 4:09 pm to fightin tigers
quote:
If you busting the limit becomes a serious issue, and you are too ignorant to figure out the other 50 apps available, then you deserve to pay the tax.
do let's play out a hypothetical here...not real life.
someone has a side hustle that brings in 3/4000 per year. all very small transactions. $25-$100. is it going to affect this person??
Posted on 6/8/22 at 4:10 pm to Screaming Viking
quote:
someone has a side hustle that brings in 3/4000 per year. all very small transactions. $25-$100. is it going to affect this person??
By side hustle you mean job/work?
Posted on 6/8/22 at 4:11 pm to Screaming Viking
quote:
someone has a side hustle that brings in 3/4000 per year. all very small transactions. $25-$100. is it going to affect this person??
In theory it shouldn't because that was taxable income all along.
On practice, probably yes because they were probably committing tax fraud and not claiming it.
My nontax advice is the IRS has already said they won't have the resources to dedicate to this so if a person wants to be risking they could carry on not claiming it.
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