Please note IRS Delays Gig-Tax Filing Rule for Side Hustles of More Than $600.
The Internal Revenue Service on Friday gave millions of Americans a one-year reprieve on new tax-reporting requirements, delaying implementation of a law that requires e-commerce platforms such as eBay, Etsy and Airbnb to give the tax agency information on users with more than $600 in revenue.
Congress passed the $600 threshold for Form 1099-K reports as part of the American Rescue Plan Act in March 2021, scheduling it to take effect for tax year 2022. Until the change, platforms had to report users’ income to the IRS if they had more than 200 transactions and $20,000 of revenue. Lawmakers lowered the threshold to boost tax compliance in an area where it is often lacking—unreported business income.
The $600 threshold would affect many gig workers who are independent contractors and haven’t been reporting income on their tax returns. Paying taxes on those earnings could come as a jolt.
The issues are different for many sellers on eBay and similar platforms, especially “casual” resellers cleaning out closets and attics. The gross revenue on the form isn’t necessarily all income. Such vendors may not owe any tax if they are selling items for less than they paid—or, when it comes to selling inherited items, less than the item’s value on the date of death.
Two Cases
There are two cases here. The first is someone who makes a living with repeat transactions and the second is the average person cleaning out their closet.
The real reason for the delay, however, is the IRS is not at all prepared to handle potentially tens of millions millions of 1099-K forms.
In addition, taxpayers would have to keep receipts of everything. Lawmakers tried to address the issues but could not reach agreement.
Not wanting a blizzard of 1099-K forms, the IRS postponed the requirement.
Trump’s Taxes
Ken Griffin Sues IRS
My Take on Trump’s Taxes
There was no legal requirement for Trump to disclose his taxes. He promised to do so, clearly a lie, but except under oath lies are not a crime.
If lying was a crime, all politicians would be in jail.
If there is fraud or errors it is up to the IRS and the State of New York to investigate, not Congress for political purposes.
Correction – Worse Than I Thought
I revised my post above above which originally stated $600 transactions not a $600 total.
This post originated at MishTalk.Com
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