Free Republic

Critics are sounding the alarm on the Internal Revenue Service significantly lowering the threshold for transaction reporting through payment apps, warning the change signals a new level of government overreach that targets small businesses and middle-class Americans. The IRS issued a reminder last week to taxpayers who utilize third-party payment processors like Venmo and PayPal about changes to reporting income in an updated explainer on their website. These changes created by the American Rescue Act now require the platforms to report any transaction over $600.

In the best of times, the Internal Revenue Service is tough to deal with, and tax season is never fun. But the past few years have seen the IRS lurch from one crisis to another. And things are about to get much worse for millions of taxpayers. In 2021 Congress expanded the reporting requirements of the obscure Form 1099-K. This information-reporting form tracks business transactions done with a credit or debit card or such peer-to-peer services as Venmo and Paypal. Prior to the change, taxpayers received a 1099-K only if they processed more than 200 business transactions, amounting to more...

Tax pros now fear that tax evasion could go viral if the health-reform bill’s new 1099 requirement takes effect next year. They say more small businesses will likely opt to do all-cash transactions under the table to avoid the 1099 reporting requirement, and all of its onerous provisions, which are worse than small businesses may realize. That's the direct opposite effect of what lawmakers had hoped for, and it would pose a bad development for the Internal Revenue Service, which for years has been under pressure from Congress to bring in more tax revenue. That revenue is needed now more...

For the non-business owners out there — here is how 1099 paperwork is filed currently. Form 1099s are like a W-2 for contractors — people who do work for a business but aren’t employees — designed to inform the IRS that a business has paid someone to do some work. Today, two limitations keep the flow of 1099s to a manageable level. First, businesses have to send 1099s only to unincorporated contractors, not to corporations. Second, 1099s only reflect the purchase of services, not goods. The flood begins in 2012 In 2012, Section 9006 erases both of these limitations, and...

The anti-business agenda of Obama and the Democrats is a major factor. The only way a job is created is for someone to risk their money to start or expand a business. Anyone considering that must look at current and future economics. That look shows an increasing level of financial risk and headaches as Obama keeps pushing for higher taxes, higher energy costs, more regulation and more forced unionism. Obama Care has a new accounting nightmare, that requires a 1099 for all financial business transactions over $600... Obama is still pushing for the card check bill, which eliminates the secret...

1099 requirement buried in health-care law riles up small businesses . Bipartisan support is building for a repeal of a little-known tax rule in President Barack Obama's signature health-care law that has drawn the ire of small businesses around the country... Starting in 2012, businesses will be required to file a 1099 tax form each time they spend more than $600 a year to buy goods or services from another company. The 1099 rule is not entirely new. Under long-standing law, businesses have to file tax forms when they buy services from individual-owned businesses or partnerships. The new law extends...

Internet sellers who don't report their sales will no longer be under the radar. Starting next year, any bank or other payment settlement company that processes credit cards, debit cards, and electronic payments such as PayPal will have to issue information returns telling the IRS what merchants receive. The new returns are Form 1099-K, Merchant Card and Third-Party Payments. Purpose of Reporting The IRS believes that many online sellers fail to report their transactions. Some don't report because they mistakenly believe that Internet sales are invisible. Others do so because they are trying to evade taxes. The IRS has found...