Do you have a business? Provide services and accept payment via a peer-to-peer or electronic service such as Venmo, Paypal or Cash App? If so you should be aware of changes to the IRS third-party reporting requirements in an effort to stem underreporting of income.
Commencing with tax year 2022 the IRS has lowered the reporting threshold to $600.00 for commercial transactions.
While the taxpayer always had the responsibility to declare all income and revenue received, regardless of source (i.e. traditional checks, cash, Venmo payment) third parties such as Venmo, PayPal, etc. only had to issue a 1099-K if they yearly payments exceeded $20,000.00 or 200 transactions.
To avoid issues and potential tax issues with the IRS taxpayers who use and accept payment through third-party payment applications may want to consider having separate accounts for their business and personal activates.
If you have questions of tax issues with the IRS or New York State Beige Law, PLLC is here to help. Contact us and start solving your tax issues today.