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Tuesday, February 7, 2023
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IRS Juggernaut Targets Venmo, PayPal Transactions, Wedding Registries

'If you sold a couch, re-sold tickets at the price you paid, or just did some extra work on the side, you could trigger greater scrutiny from the Internal Revenue Service... '

(Molly Bruns, Headline USA) A recent reminder to report $600 transactions from Venmo and PayPal to the Internal Revenue Service has Republican lawmakers sounding alarm bells about the growing reach and power of the Biden administration’s super-sized auditing agency.

The Biden administration claimed that the goal of the measure hidden in the American Rescue Plan was to crack down on wealthy taxpayers attempting to find loopholes in the system.

According to the Daily Mail, the provision requires American taxpayers add their 1099-K “gross payments for goods and services that exceed $600.”

The IRS posted a FAQs sheet, reminding Americans that the point had been lowered from $2,000 to $600 and the number of transactions that trigger receiving a form will also be lowered from 200 to 1.

The change will also apply to 3rd party payment processors—such as Venmo—part-time work, side jobs or selling goods.

“If you sold a couch, re-sold tickets at the price you paid, or just did some extra work on the side, you could trigger greater scrutiny from the Internal Revenue Service,” Republicans on the House Ways and Means Committee wrote in a statement.

Not reporting such payments could trigger an audit, as the IRS has a copy of the 1099-K form directly from the third-party payment processors.

After the signing of the Inflation Reduction Act, the IRS was given the opportunity to hire up to 87,000 new agents, reportedly to answer taxpayer phone calls.

A goal of the Inflation Reduction Act, which will do nothing to reduce inflation, is to bring in a surplus of money to assist in paying for the massively expensive American Rescue Plan, which focuses on social and climate spending program.

Professionals estimate that the number of 1099-K forms could be passed out could be as high as 20 million.

“The 1099-K tsunami is coming in January,” Arshi Siddiqui, a former aide to Speaker Nancy Pelosi, D-Calif., and a lobbyist for the Coalition for 1099-K Fairness, said. “We’re talking about millions of 1099-K’s going out, some of which are based on transactions that do not trigger tax liability.”

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