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IRS Delays New $600 Reporting Threshold for PayPal, Venmo

DDG
DDG

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IRS Delays New $600 Reporting Threshold

IRS Delays New $600 Reporting Threshold for PayPal, Venmo

The Internal Revenue Service has announced a delay in reporting thresholds for apps like Venmo, PayPal and others, which was set to take effect for the upcoming tax filing season.

As a result of this delay, these payments services will not 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 enacted as part of the American Rescue Plan of 2021.

The IRS said that calendar year 2022 will be a transition period for implementation of the lowered threshold reporting, which could likely affect millions or filers.

The American Rescue Plan of 2021 lowered the reporting threshold for business transactions to $600 per year. That’s down more than 200 transactions per year and an aggregate amount of $20,000. The law is not intended 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. However, it could prove difficult for companies to differentiate between these transactions when issuing Form 1099-K.

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

Disclosure: Miles to Memories has partnered with CardRatings for our coverage of credit card products. Miles to Memories and CardRatings may receive a commission from card issuers.

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DDG
DDGhttp://dannydealguru.com
Based in NYC. Points/miles enthusiast for years and actively writing about it for the last 6+ years at Danny the Deal Guru. I'm always looking out for deals. Making a few bucks is always nice, but the traveling is by far the best part of this business.

Responses are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.

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