IRS delays new tax reporting requirement for Venmo, Cash App users

Funviralpark 1 year ago 0 4

The IRS announced Friday that it will delay the rollout of new rules set to lower tax reporting thresholds for transactions businesses make through third-party payment platforms such as Venmo and Cash App.

In a release, the IRS said it chose to delay lowering the threshold to $600 after concerns the agency and the Treasury Department received about the timeline.

The American Rescue Plan, the $1.9 trillion COVID-19 stimulus package that Congress passed last year, requires sellers to report if transactions through these third-party networks total more than $600 in a single year. Includes provisions. A threshold of over 200 transactions over $20,000 per year.

The provision was supposed to go into effect on January 1, 2023, but the IRS delayed implementation, saying calendar year 2022 would be the “transition period” for the change.

“The additional time will help reduce confusion during the upcoming 2023 tax filing season and provide more time for taxpayers to prepare and understand the new reporting requirements,” said Acting IRS Commissioner. said Doug O’Donnell of

The release says implementation of the new threshold will be delayed for transactions occurring after 2022. The delay is intended to facilitate an “orderly transition” for compliance from third-party organizations and individuals, the agency said.

The IRS said the law does not affect private transactions, where individuals share the cost of rides, meals, gifts and household expenses.

The agency recognizes that policies need to be carefully managed to ensure that 1099-Ks, the forms used to report commercial transactions, are only sent to taxpayers who should receive them. said. Additional details on delays and information to help taxpayers will be available in the near future, it said.

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