by Ronny Reyes at Daily Mail
- Taxpayers will have to report Venmo, PayPal, and other third-party payment app transactions that exceed $600 to the IRS in their 2021 tax returns
- The new rule applies only to business transactions, so those who use the apps to sell a personal item or wire money to friends will not be subject to reporting it
- Taxpayers who fall within the new law will receive a 1099-K form from each of the third-party payment companies they conducted business through
- The companies urged users who get a 1099-K to make sure they accurately report their earnings because errors could lead to an IRS audit
Starting this year, Americans will have to report Venmo, PayPal, and other third-party payment app transactions over $600 to the IRS.
The Biden Administration’s American Rescue Plan requires taxpayers to file a 1099-K for ‘gross payments for goods or services that exceed $600.’
The earnings were already taxable, so the law is aimed at codifying how they’re reported to crack down on fraud.
More importantly, the rule is aimed specifically toward business transactions, so if you’re sending money to a friend, selling off something online, or collecting a one-time payment, the new rule won’t apply to you…
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