Venmo, Paypal and Zelle must report $600+ transactions to IRS

[Ken555]

Nobody ever accused the IRS of not being at PITA. Remember this when the next election day comes around.

Now that this thread has turned partisan, I just have to laugh. As if the IRS hasn’t wanted to track everything forever, during every administration. You guys probably think the admin controls the spending, too, right? Hello….Congress. Give me a break.


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[SmithOp]

As I like to tell my tax clients, when you file you are confirming what the IRS already knows.


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[CalGalTraveler]

I'm going back to checks or cash for reimbursements. That way a 1099 will not be generated - less for IRS to flag.

I dont blame a party. The IRS is its own beast. Ballot box does not matter.

 

[The Colorado Kid]

I'm going back to checks or cash for reimbursements. That way a 1099 will not be generated - less for IRS to flag.

I dont blame a party. The IRS is its own beast.

Exactly what I think MANY people will do.

 

[CalGalTraveler]

A lot of people are going to be surprised when they receive a 1099 in Jan. 2023

 

[chapjim]

Now that this thread has turned partisan, I just have to laugh. As if the IRS hasn’t wanted to track everything forever, during every administration. You guys probably think the admin controls the spending, too, right? Hello….Congress. Give me a break.


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When the administration and Congress seek to massively increase spending, then announce that it will be paid for by increased taxes, this is some of what we get. Open 'em up!

 

[CalGalTraveler]

When the administration and Congress seek to massively increase spending, then announce that it will be paid for by increased taxes, this is some of what we get. Open 'em up!

Let's not forget who cut taxes for the rich with no plan to reduce spending or find revenue to cover the shortfall. That contributed.

 

[chapjim]

Let's not forget who cut taxes for the rich with no plan to reduce spending or find revenue to cover the shortfall. That contributed.

Nothing to complain about then, right?

 

[Brett]

A lot of people are going to be surprised when they receive a 1099 in Jan. 2023

Probably not because it only applies to commercial transactions with the same requirements as prior years

https://www.nbcnews.com/news/venmo-paypal-zelle-must-report-600-transactions-irs-rcna11260

 

[Brett]

Let's not forget who cut taxes for the rich with no plan to reduce spending or find revenue to cover the shortfall. That contributed.

yes, the HUGE and GREAT tax cuts ... for some

corporations are people too !

 

[jules54]

Probably not because it only applies to commercial transactions with the same requirements as prior years

https://www.nbcnews.com/news/venmo-paypal-zelle-must-report-600-transactions-irs-rcna11260

As asked before how is IRS tell the difference between personal and commercial transactions? PayPal has had friends vs Goods and Services already. I don’t think there will be a way to split the 2 up since I believe it reads over 600.00 annually not per transaction. More paperwork for the little guy, more jobs created for the IRS.
When I was still working my real job Goodyear Tire and Rubber for 43 yrs. I did file a business forms with IRS for my timeshare rentals. When I retired in 2016 I closed that business. I assume what this means to me is more record keeping. It’s not the difficult expenses-cost of sale=income. All the numbers are on credit card statements or Venmo, PayPal history. I still don’t have to like it and I don’t. I believe I wait for the IRS to contact me before I automatically start supplying information to them. I’ve been using Airbnb and VRBO for years and have never received a 1099 from either. I’ve been audited in the past for the income area of my taxes and it can be brutal. I’m retired now so I don’t fear this as I have the time now to deal with it and the stomach medications are improving all the time lol.

 

[CalGalTraveler]

Nothing to complain about then, right?

You were complaining it was just one party. Both sides created the conditions to raise taxes.

 

[bogey21]

My guess is that except for scanning the data for huge numbers the primary use of all the data generated will be after the IRS has flagged a Tax Return for audit for some other reason...

George

 

[Tia]

I questioned why in the drive through that day, didn't get a real answer. Was even going to go inside the bank as thought she said they could take the ca$h inside.......... then she said she could take a check. Luckily I carry 1 w/me so wrote a check and she said the money was immediately available for the relative whose account it went into. Maybe it's Wells Fargo specific?

These are questions for your bank. I have had no problems with cash in or out, nor checks in or out.

 

[Brett]

No, the IRS isn’t taxing your Venmo transactions
https://www.cnbc.com/2022/01/12/irs-isnt-taxing-your-venmo-transactions.html

“There’s been a lot of misunderstanding about the tax reporting changes,” says Garrett Watson, senior policy analyst at the Tax Foundation. “It doesn’t change anything about if any transactions are taxed or not.” In other words, the IRS is not starting to tax individual transactions between family and friends.

Splitting dinner with your friend, sending your roommate money for rent or gifting your cousin a round of birthday drinks? Don’t sweat it. “It’s not taxable,” Watson says.

 

[joestein]

What I read is that they must report when AGGREGATE transactions from a single party are at or over $600. This means 12 $50 transfers in a calendar year would be reported. So much for "we'll raise the money by taxing the rich"

This is not about taxing the rich. This is about tax cheats. They don't want income that people make going unreported.

If someone has a side business renting TS - the income they make should be reported to the IRS. That is the LAW. You can deduct your expenses including maintenance & depreciation. You might actually get a small loss that you can apply against your other income. It is not like you are going to sell your timeshare down the road for a big gain over its tax basis.

Joe

 

[joestein]

It used to be anything over $10,000 was automatically reported to the IRS.

I guess the new threshold is now $600 or greater........

However, if you're reporting your income and paying your taxes as you should be then will any of this really be an issue at all?



.

That was for cash transactions.... not wire transfers or checks. If you cash a check over $10K or tried to deposit over $10K the bank would need to file a form with the IRS.

 

[joestein]

You were complaining it was just one party. Both sides created the conditions to raise taxes.

We should go back to the tax rates of the Clinton Era. Everybody needs to pay something/more. I was relatively poor during that period and the effective taxes were much higher for all. But we had a relatively balanced budget.

In 1995 - my first full year of marriage - we earned $68K - all W-2 earnings. We paid $16,709 combined fed, state and local tax. That is only INCOME tax (no payroll, sales or RE tax). An effect rate of 24.5%. Today, we earn multiples of that - but our effective income tax only rate for combined fed, state and local was 21%. That is our problem. I am the closer to the top of the brackets than the bottom, but my effective rate has dropped 14.2%. Our taxes have been reduced, but the gov't spending has been increased.

Neither party has the guts to confront the deficit or the debt. They are both to blame.