The IRS said these changes also apply to people who sell products on Internet auction sites like eBay.
Photo: CopyrightFreePictures / Pixabay
TO Starting January 1, mobile payment apps like Venmo, PayPal, Zelle, and Cash App must report business transactions totaling more than $ 600 per year to the IRS. This law came into effect as part of the American Rescue Plan, which was passed in March of last year.
Previously, these mobile payment apps only had to report to tax authorities when a person had more than 200 business transactions per year that exceeded $ 20,000 in total.
But as of January 1, if a person accumulates more than $ 600 a year in commercial payments in an app like Venmo, for example, then Venmo must file a Form 1099-K with the IRS, reporting all the business income they collected through the app.
The tax return change only applies to charges for business goods or services, not personal charges made between friends and family, such as dividing a dinner bill.
The IRS said these changes also apply to people who sell products on Internet auction sites like eBay., as long as they accept credit card payments through these applications.
PayPal said they and Venmo offer a way for customers to tag their transactions to see if they are personal among friends and family, or goods and services, as users can choose the appropriate category for each transaction.
“Users must select Goods and Services whenever they send money to another user to purchase an itemLike a couch for a local ad or concert tickets, or paying for a service, ”PayPal said.
You may also like:
– Congress analyzes economic stimulus for companies most affected by the pandemic, such as restaurants
– Harvard economist shares rules about money for a healthy economic life
– Calendar of arrival of Social Security checks to retirees with a rise of 5.9% due to COLA adjustment as of January 12