IRS Puts a Hold on Rule Change Affecting Venmo, Etsy Users

IRS Puts a Hold on Rule Change Affecting Venmo, Etsy Users

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Digital entrepreneurs, FreelancersSmall business owners across the globe will be glad to hear this information. IRS The suspension of implementation of a rule that would have required payment processing platform to issue 1099 forms for transactions exceeding $600 is a sign of respect. By law, payments for goods and services, as well as tips, are taxable business transactions.

The IRS used to issue 1099-K forms to businesses that had 200 transactions exceeding $20,000 per year.

CNN The IRS Commissioner Doug O’Donnell, who was quoted as saying that there were “a lot of concerns” about the timeline for implementation of the changes under the American Rescue Plan. O’Donnell stated that the IRS wants to ease the transition and that “an additional time will help reduce confusion during 2023 tax filing season, and provide more time to taxpayers to prepare for and understand the new reporting requirements.”

Small business owners and independent contractors have more time to learn the new reporting requirements and be ready to go.

CNN reports that the rule will not result in additional taxation or affect personal Venmo transactions, such as splitting a check at a restaurant. The rule will not affect personal Venmo transactions such as splitting a check at a restaurant. 1099-K report It is expected that this will reduce tax evasion.

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