https://www.accountingtoday.co...&bt_ts=1671821858962

It needs to be eliminated, not just postponed!


The Internal Revenue Service on Friday postponed the introduction of a $600 threshold for filing a Form 1099-K to report on transactions involving services such as eBay, PayPal, Venmo, Etsy and third-party settlement organizations, which was scheduled to take effect in the New Year and generate millions of new forms going out to unsuspecting taxpayers and their accountants.

Organizations such as the American Institute of CPAs, the National Association of Tax Professionals, the National Taxpayers Union and others had been sounding warnings about the lower threshold, which was down from $20,000 previously. It was included as part of the American Rescue Plan Act of 2021 as a way to raise extra tax revenue, and lawmakers in Congress were lobbied heavily to forestall the change or at least raise the threshold.

As a result of the delay, the IRS said third-party settlement organizations won't be required to report tax year 2022 transactions on a Form 1099-K to the IRS or the payee for the lower, $600 threshold amount. In tandem with the announcement, the IRS released guidance Friday stating that calendar year 2022 will now be a transition period for implementation of the lowered threshold reporting for third-party settlement organizations including Venmo, PayPal and CashApp that would have generated Form 1099-Ks for taxpayers.

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Internal Revenue Service headquarters in Washington, D.C.Al Drago/Bloomberg
"The IRS and Treasury heard a number of concerns regarding the timeline of implementation of these changes under the American Rescue Plan," said acting IRS commissioner Doug O'Donnell in a statement. "To help smooth the transition and ensure clarity for taxpayers, tax professionals and industry, the IRS will delay implementation of the 1099-K changes. The additional time will help reduce confusion during the upcoming 2023 tax filing season and provide more time for taxpayers to prepare and understand the new reporting requirements."

The American Rescue Plan Act lowered the reporting threshold for third-party settlement organizations to $600 per year from the earlier threshold of more than 200 transactions per year, exceeding an aggregate amount of $20,000. The law doesn't aim to track personal transactions such as sharing the cost of a car ride or meal, birthday or holiday gifts, or paying a family member or another for a household bill.

Under the law, beginning Jan. 1, 2023, organizations were required to report third-party network transactions paid in 2022 with any participating payee that exceed a minimum threshold of $600 in aggregate payments, regardless of the number of transactions. Third-party settlement organizations report these transactions by providing individual payees a Form 1099-K, "Payment Card and Third-Party Network Transactions."

The transition period described in Notice 2023-10 defers the reporting of transactions in excess of $600 to transactions that occur after calendar year 2022. The transition period aims to facilitate an orderly changeover for the organizations' tax compliance, as well as individual payee compliance with income tax reporting. A participating payee, in the case of a third-party network transaction, is any person who accepts payment from a third-party settlement organization for a business transaction.

The change under the law is especially significant because tax compliance is higher when amounts are subject to information reporting, like the Form 1099-K. However, the IRS said it must be managed carefully to help ensure 1099-Ks are only issued to taxpayers who should receive them. On top of that, it's important for taxpayers to understand what to do in response to this reporting, and tax preparers and software providers will have the information they need to help taxpayers.

The IRS promised more details on the delay will be available in the near future along with information to help taxpayers and the industry. For taxpayers who may have already received a 1099-K as a result of the statutory changes, the service said it's working rapidly to provide instructions and clarity so taxpayers know what to do.

The IRS added that the existing 1099-K reporting threshold of $20,000 in payments from over 200 transactions will stay in effect.

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It was included as part of the American Rescue Plan Act of 2021...

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Originally posted by nhracecraft:

quote:

It was included as part of the American Rescue Plan Act of 2021...

Yeah what the fuck is that supposed mean?

Let's ease the financial strain on taxpayers by taxing them more.

^^^^^^^^^^^^^^
The names of these bills are ludicrious. Inflation Reduction Act etc.

OK What is the status on the New IRS agents to be hired?? The Omnibus supposed included some reduction in monies of the IRS.

quote:

Originally posted by nhracecraft:

quote:

It was included as part of the American Rescue Plan Act of 2021...

Duh... how else were they going to recoup the $1.9 trillion in stimulus money they were handing out in that same act?

Collect more taxes.

There's no such thing as a free lunch.

^^^And apparently, we're the ones that need to pay while they fuck us...

If it makes you feel better ONE THIRD of Americans receive FREE healthcare through Medicaid. Some states allow income to be up to 80 thousand.

^^^Why would that make me feel better?

You guys are all getting worked up over nothing. Once the government forces all monetary transactions to be digital, you'll never have to file any of this paperwork. They'll simply deduct their share as part of the transfer at the time it's made.

Not in my lifetime. Besides there is always bartering. That is how the Native Americans got by.

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Originally posted by ZSMICHAEL:
If it makes you feel better ONE THIRD of Americans receive FREE healthcare through Medicaid. Some states allow income to be up to 80 thousand.

And people wonder why so many are not going to work.

Not bad for a family of four to stay home and watch tv all day.

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Why would that make me feel better

^^^^^^^^^^^^^^^
Sarcasm. I suspect you are employed.

quote:

Originally posted by ZSMICHAEL:
^^^^^^^^^^^^^^
The names of these bills are ludicrious. Inflation Reduction Act etc.

Patriot Act......

That was the one they set me over.

^^^Don't forget this one --> https://sigforum.com/eve/forum...0601935/m/3030067694

Big tech companies (eBay, PayPal, Venmo, Poshmark, CashApp) like big government.

Big government likes taxes and regulation.

Somehow, big tech is surprised when they are the ones getting more taxes and additional regulation.

Who knew?

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Originally posted by .38supersig:
Big tech companies (eBay, PayPal, Venmo, Poshmark, CashApp) like big government.

Big government likes taxes and regulation.

Somehow, big tech is surprised when they are the ones getting more taxes and additional regulation.

Who knew?

The tech companies aren't the ones getting more taxes here... The IRS wants to collect income tax on money individuals receive using these electronic payment systems.

Say you sell your guitar on eBay for $800, and the buyer pays with Paypal. Paypal now is required to generate a 1099-K, which they send to both you and to the IRS. You are then required to claim that $800 as income on your annual income tax return, and pay income tax on it.

You pay the income tax. Not Paypal. Not eBay. You.

Covered here:

https://sigforum.com/eve/forum...0601935/m/3040070694

^^^^^ I'm still wondering how the hell you're supposed to prove that you didn't make a profit on said guitar assuming you paid more than $800 for it. Or should people just expect to get audited up the ass every year. Fucking IRS. Fucking democrats