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The IRS has suspended 3rd Party Payer Reporting for Tax Year 2022. But it will be in effect for 2023:
www.irs.gov
What this means is if you sell stuff from your attic on ebay and it is in excess of $600 (old threshold was $20,000) in a year, Ebay or Paypal or Venmo, will be sending you a 1099-K for the gross amount. So if you don't keep good records, you could owe tax on the total amount. The reporting for 2022 caught me off-guard, but I will be prepared for 2023.
The law only applies to sales, not for sending friends and family money. I know some people trying to get around paying Paypal fees by saying it is for friends, but I would never do that because you lose the buyer protections.
I created a Google Sheets where I list the date, a description, amount and my basis, or what I paid. If I don't know what I paid, I try to find an MSRP.
IRS announces delay for implementation of $600 reporting threshold for third-party payment platforms’ Forms 1099-K | Internal Revenue Service
IR-2022-226, December 23, 2022 — The Internal Revenue Service today announced a delay in reporting thresholds for third-party settlement organizations set to take effect for the upcoming tax filing season.
What this means is if you sell stuff from your attic on ebay and it is in excess of $600 (old threshold was $20,000) in a year, Ebay or Paypal or Venmo, will be sending you a 1099-K for the gross amount. So if you don't keep good records, you could owe tax on the total amount. The reporting for 2022 caught me off-guard, but I will be prepared for 2023.
The law only applies to sales, not for sending friends and family money. I know some people trying to get around paying Paypal fees by saying it is for friends, but I would never do that because you lose the buyer protections.
I created a Google Sheets where I list the date, a description, amount and my basis, or what I paid. If I don't know what I paid, I try to find an MSRP.