1099K $600 reporting threshold - what are people doing now?

[Cardinal Grammeter]

I'm not a business selling personal property and have been trying to figure out how to deal with on fed tax form.

 

It doesn't look good.  Even if I could write off shipping, cost, etc.  I don't have receipts for all the junk I've bot over the past 55 years.

 

I'll buy with PP, but I'm going to stop accepting payment with it.

Edited February 4, 2022 by Cardinal Grammeter

[Mattndew76]

I pay an accountant $300 to itemize everything, and save all receipts regardless.

 

I fucking hate the machine.

Edited February 4, 2022 by Mattndew76

[datzenmike]

My wife is a financial advisor and knows how to find money, look after it, grow it and keep it away from those that don't deserve it.

.   

[Cardinal Grammeter]

I should have said Not a business and personal property - will Edit that in.

 

I'm just going to go back to pre Paypal days when I required people to send me a US Postal MO.  If they're worried about Buyer Protection too bad.  Back in days of Shutterbug Ads and Hemmings, you sent the man your check and you got your parts - and it was up to the Buyer if they wanted to pay for insurance.

 

Note on receipts:  Even if you did have the cost you paid for a car which you parted out.  How would you be able to determine what you paid for a piece of trim?  Technically, you would have to price ALL the parts of the cars and prorate to get the cost - prices determined by eBay, market or dealer price sheet.  That would be ridiculous.

Edited February 4, 2022 by Cardinal Grammeter

[john510]

I wouldn't even bother filing it on my taxes.It's my personal property and none of their business what i do with it.

[Cardinal Grammeter]

1 hour ago, john510 said:

I wouldn't even bother filing it on my taxes.It's my personal property and none of their business what i do with it.

I read a post from an Intuit rep and they said the IRS will send a form (don't remember name) because your return did not match what was reported to them.  They'll as for the 1099-K number and then will want the cost of said items and receipts.  Of course even if you could do that, I believe you're still on the hook for fees and shipping unless you do Sch C.

 

And also, if you start a Sch C for the first 1099-K reported to them, they want to know why you weren't reporting in previous years.

 

Best thing to do is stay under the limit and avoid their wrath - especially if they start letting automated systems handled audits - like trying to deal with Facebook computers.  That would be the real nightmare but I'll bet that is where we're headed.

[angliagt]

    What could go wrong? - The Government will take care of us.

Trust me.....

[]2eDeYe]

Checks are making a comeback ...

You can upload them via pic through your bank app.

[Cardinal Grammeter]

REMINISCING pre-PAYPAL DAYS:

 

Before Paypal on eBay, I got paid with USPS MO - like in the pre-internet mail-order days.  I had a 100% positive feedback (still is last time I checked) and something like 100 from buyers.

 

My philosophy was "Since I know I'm honest, any deal with me will be just even if the buyer is a crook".

 

There was a guy from Brussels that bot a Monogram 1/32nd scale Chaparral slot car from me for $75 shipped and paid with US currency wrapped up in an envelope he posted to me.  

 

Ahhhh.... those were the days.

 

Now I have this poor sod in Australia that wants to buy something with like $200 worth of shipping on it and not using Paypal, how to pay?  Thinking....  I do remember getting a bank check from Ireland for a $75 purchase on eBay - this was back when USPS had ground international (by boat - Ahhhh.... those were the days).  I called the bank in Ireland to confirm the check and it was good but that Irish accent just made me melt - I felt like I wanted to move there.

I put eBay and Paypal right up there with Gates and Zuckerberg.  (Gates and Zuck will fuck up Hell too.  NOTE:  Am I possibly the first to say this? - perhaps my only contribution to Mankind?)

 

 

 

[Dav]

Checks - not as good as cash.

 

IRS can do audits of amounts going into bank accounts - if they see large total amounts and there is no explanation, they can assume it is from illegal source, and tax it (at a minimum).

 

Best bet is a stash o cash in the mattress.

[iceman510]

Split payments into smaller increments.

[Cardinal Grammeter]

26 minutes ago, iceman510 said:

Split payments into smaller increments.

 

Doesn't work, outfits like Paypal simply total your payouts from all selling sites you use, for the year and if above the threshold, issue the 1099-K notification to the IRS. 

I'm guessing, but If you accept credit cards, I believe they are a separate 1099-K.  I'm guessing all VISA cards are totalled together and perhaps Mastercard is another total.  So if you had PP, V & M, you could sell up to $1800 total w/o notification.

I'm not a business, but I'm trying to do an "estate sale" while I'm still alive.

[thisismatt]

Glad to see Biden going after the billionaires

[Cardinal Grammeter]

57 minutes ago, thisismatt said:

Glad to see Biden going after the billionaires

 

It's actually ironic, rather than have poor people hustle to make a little money, they'd rather have them sit on their ass and collect a government check.

 

What is worrisome is that the Doubling of the Standard Deduction was part of the TCJA (Tax Cuts and Jobs Act of 2018), will expire in 2026 if not written into law (!)  

[iceman510]

1 hour ago, Cardinal Grammeter said:

 

Doesn't work, outfits like Paypal simply total your payouts from all selling sites you use, for the year and if above the threshold, issue the 1099-K notification to the IRS. 

I'm guessing, but If you accept credit cards, I believe they are a separate 1099-K.  I'm guessing all VISA cards are totalled together and perhaps Mastercard is another total.  So if you had PP, V & M, you could sell up to $1800 total w/o notification.

I'm not a business, but I'm trying to do an "estate sale" while I'm still alive.

 

Hmmm, have not read the proposal myself, just hearing commentary, but I thought it was per "transaction", not total sales.  In the past I expected to receive a 1099 from a shop I used to sell handmade parts for since payments were over $1000 one year, but I never received it.  Anything I make goes under "hobby income".  

[Cardinal Grammeter]

30 minutes ago, iceman510 said:

 

Hmmm, have not read the proposal myself, just hearing commentary, but I thought it was per "transaction", not total sales.  In the past I expected to receive a 1099 from a shop I used to sell handmade parts for since payments were over $1000 one year, but I never received it.  Anything I make goes under "hobby income".  

 

Some states have a $600 limit and when I lived in FL, I believe I was supposed to issue a 1099 for each rent I paid since it was >$600 - who knows, maybe if I paid $100/month for a garage, at the end of the year I'd have to issue a $1200 1099 (but what do you do when your landlord won't give you his SS or Tax ID #?).  Of course no one did that.  But you can see where this is headed....

[Dav]

Federal rules require 1099s not state rules. States piggyback on federal if they tax it. If not, then they don’t care.

 

PayPal reporting requirement is total received, not per transaction. They don’t care about what you send to pay, but you do - to support your expenses claimed.

 

Hmm, law was passed in 2018, not 2020 - 2021. Who was prez then (hint it wasn’t FJB)? Now you get to see the effect of something your best bud passed a few years ago.

 

What can you do now? Stop using PayPal AND your bank account.

 

PayPal because they report.

 

Why no bank either? Because another requirement of that same law that your best bud signed is banks now required to report all inflows above $10,000 for any reason. So, you get a $5000 paycheck every month - and you get $1000 every month from your hobby? IRS will now know you got $72,000 into that account over the year. Bank will send info to IRS every year.

 

Need to buy more guns n keep all your cash in your mattress.

 

Talk to your Accountant - he knows.

[thisismatt]

19 minutes ago, Dav said:

Federal rules require 1099s not state rules. States piggyback on federal if they tax it. If not, then they don’t care.

 

PayPal reporting requirement is total received, not per transaction. They don’t care about what you send to pay, but you do - to support your expenses claimed.

 

Hmm, law was passed in 2018, not 2020 - 2021. Who was prez then (hint it wasn’t FJB)? Now you get to see the effect of something your best bud passed a few years ago.

 

What can you do now? Stop using PayPal AND your bank account.

 

PayPal because they report.

 

Why no bank either? Because another requirement of that same law that your best bud signed is banks now required to report all inflows above $10,000 for any reason. So, you get a $5000 paycheck every month - and you get $1000 every month from your hobby? IRS will now know you got $72,000 into that account over the year. Bank will send info to IRS every year.

 

Need to buy more guns n keep all your cash in your mattress.

 

Talk to your Accountant - he knows.

 

• 1099-K Threshold Change:
  • This new Threshold Change is currently only for payments received for goods and services transactions, so this doesn’t include things like paying your family or friends back using PayPal or Venmo for dinner, gifts, shared trips, etc.
  • This change was introduced in the American Rescue Plan Act of 2021, which amended some sections of the Internal Revenue Code to require Third-Party Settlement Organizations (TPSOs), like PayPal and Venmo, to report goods and services transactions made by customers with $600 or more in annual gross sales on 1099-K forms. Currently, a 1099-K is only required when a user receives more than $20,000 in goods and services transactions and more than 200 goods and services transactions in a calendar year.

 

 

The American Rescue Plan Act of 2021, also called the COVID-19 Stimulus Package or American Rescue Plan, Pub L. No. 117-2 (March 11, 2021), is a US$1.9 trillion economic stimulus bill passed by the 117th United States Congress and signed into law by President Joe Biden on March 11, 2021

 

[Dguy210]

1 hour ago, thisismatt said:

 

• 1099-K Threshold Change:
  • This new Threshold Change is currently only for payments received for goods and services transactions, so this doesn’t include things like paying your family or friends back using PayPal or Venmo for dinner, gifts, shared trips, etc.
  • This change was introduced in the American Rescue Plan Act of 2021, which amended some sections of the Internal Revenue Code to require Third-Party Settlement Organizations (TPSOs), like PayPal and Venmo, to report goods and services transactions made by customers with $600 or more in annual gross sales on 1099-K forms. Currently, a 1099-K is only required when a user receives more than $20,000 in goods and services transactions and more than 200 goods and services transactions in a calendar year.

 

 

The American Rescue Plan Act of 2021, also called the COVID-19 Stimulus Package or American Rescue Plan, Pub L. No. 117-2 (March 11, 2021), is a US$1.9 trillion economic stimulus bill passed by the 117th United States Congress and signed into law by President Joe Biden on March 11, 2021

 

 

 

This is so going to disappoint my 23 dependents when I file my taxes

 

[Cardinal Grammeter]

The $20,000 limit was for 2021, 2022 and forward it is $600 for the 1099-k.

 

Facebook is still saying there's a $20,000 limit - they haven't even updated their site info.

 

I have to laugh, I have H&R Block Tax Software for my SS and small pension (about 1/3rd of my SS) and I opened my 2020 return to see where to put 1099-K income if I had received any.  I couldn't find any place.  I'll bet that changes for 2022.  Or the tax softwares may only handle 1099-K's if you are a Sch C business.  We'll see what happens in 22.

Edited February 8, 2022 by Cardinal Grammeter

[angliagt]

       I CAN'T WAIT!

[john510]

Sounds like cheating is so much easier.The IRS has much bigger fish to fry than some guy selling personal property.

[Dguy210]

On 2/9/2022 at 4:43 PM, john510 said:

Sounds like cheating is so much easier.The IRS has much bigger fish to fry than some guy selling personal property.

 

If you trick a thief into not stealing your property is it really "Cheating"?

[Ooph!]

On 2/7/2022 at 4:43 PM, Dav said:

 

Hmm, law was passed in 2018, not 2020 - 2021. Who was prez then (hint it wasn’t FJB)? Now you get to see the effect of something your best bud passed a few years ago.

 

 

 

Hmm obvious troll is obvious, nice try

[john510]

12 hours ago, Ooph! said:

 

Hmm obvious troll is obvious, nice try

No kidding because Trump invented the 1099 form.LOL.