Goods and Services Fee

[H Upmann]

I don't think this really belongs here but anyway. I sold a couple of boxes last week and one gentleman here paid PP goods and services. I never cared before but not even 10 minutes later, I received an email from PP alerting me that my tax ID number didn't match up with what they had on file. WTF? I didn't know about the new law that went into effect this year stating any transaction of good and services over $600 requires that the IRS is notified. This definitely changes all of my future transactions to Friends and Family ONLY. I am to believe that it must be the same way with all other payment options or am I wrong. Waddya Think?

[tstoner86]

Yep. That’s why I specify F and F. No reporting for that. Also Zelle has no reporting, so that might be an option.

If someone pays via G&S I always ask for the additional % to cover fees. Now I won’t accept app g&s at all.


Sent from my iPhone using Tapatalk

[perfectoman]

I think the gov is trying to rape the small guy starting now.
Better do a search.  The whole system has been turned upside down for the little guy.

[tstoner86]

All this slid through the the "Recovery Act" last Spring. Friggin biggest crooks on earth, Congress, and they want to know when $600 passes to your account. LMFAO

[TheGipper]

According to the page on PP where they explain this, the 1099 requirement does indeed only apply to goods and services payments.

From one of their help pages:

[quote]Will PayPal report my business sales to the IRS?

All US payment processors, including PayPal, are required to provide information to the US Internal Revenue Service (IRS) about customers who receive payments for the sale of goods and services.

Accordingly, PayPal tracks the total payment volume on your account to determine whether it meets the IRS threshold in a calendar year.

Customers will be required to provide tax information like an Employer Identification Number (EIN), Social Security Number (SSN), or an Individual Taxpayer Identification Number (iTIN), if they haven’t already provided it when they approach $600.00 USD for the sale of goods and services during 2022.

We may ask you to provide your Taxpayer Identification Number (TIN.) A Social Security Number (SSN), Individual Taxpayer Identification Number (ITIN), or Employer Identification Number (EIN), to your existing account, if you don’t already have one on your account. If your TIN fails verification, you’ll need to complete a substitute Form W-9.

If you meet the IRS threshold in a given calendar year, PayPal will send you a Form 1099-K in January of the following year and file this form with the IRS by the required due date.[/quote]

[mbflash80]

dont believe this is new?  I have been issuing 1099s to folks (for my real job) for any payments totaling $600 or more for years...think its standard stuff...but I might be wrong (as usual)

[tstoner86]

It’s new for the pay apps on 2022 tax year.


Sent from my iPhone using Tapatalk

[RamonBocAllone]

[quote author=mbflash80 link=topic=54337.msg207419#msg207419 date=1644541413]
dont believe this is new?  I have been issuing 1099s to folks (for my real job) for any payments totaling $600 or more for years...think its standard stuff...but I might be wrong (as usual)
[/quote]

Probably

[perfectoman]

The IRS is now requiring the 3rd party cash apps to report to them.
It isn't really new just in the past it was just left up to the individual to claim on their taxes.
And how many were actually doing that?    :angl:

[thegoldenmackid]

Correct. Similar to most states and sales tax for online purchases.

Pre Wayfair, in many states you were supposed to report your online purchases to the state and pay sales tax after the fact as a consumer, the difference was that states weren't requiring online sellers to charge the sales tax (and many lacked the resources to go after the out-of-state online stores.)