I believe this is $600 total for the year, not just transactions that each total $600 or more?
Paypal Changes for 2022
If I understand this correctly, Paypal, along with all on-line payment sources like Venmo, etc. will now be sending out 1099 forms for all payments totaling $600 you receive in 2022 for goods or services. The only way around this is to use Paypal friends and family for payment which eliminates any buyer protections. Is everyone aware of this?
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If you own your own business or have a side hustle and get paid through digital apps like PayPal, Zelle, Cash App or Venmo, earnings over $600 will now be reported to the IRS. A provision from the 2021 American Rescue Plan, which went into effect on Jan. 1, directs third-party payment processors to report transactions received for goods or services totaling over $600 per year to the IRS. Prior to this legislation, a third-party payment platform would only report to the tax agency if a user had more than 200 commercial transactions and made more than $20,000 in payments over the course of a year. The key thing to know right now is that it doesn't apply to your 2021 tax return, which you'll file this tax season. But it will apply to the earnings you make throughout 2022, which you'll report when you file in 2023. |
Some of us unfortunate to live in a few select states were already subject to the dreaded PayPal 1099-k tax forms: HERE Copy / paste: Several states have already closed this reporting loophole on the state level:
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