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1099-K Tax from from Paypal???

Old 02-19-2012, 01:12 PM
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Default 1099-K Tax from from Paypal???

I received a 1099-K from Paypal for exceeding 200 transactions and $20K in income. Did anyone else get one? How are you reporting it on your taxes?
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Old 02-19-2012, 01:28 PM
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Originally Posted by n0averagejoe View Post
I received a 1099-K from Paypal for exceeding 200 transactions and $20K in income. Did anyone else get one? How are you reporting it on your taxes?

I believe that is the threshold when IRS decides you are running a business through ebay/paypal. This was announced in 2009 that the law would go into effect in the 2011 calendar year. Supposedly you have to meet both criteria . . . 200 transactions and $20k in one year to flag paypal/IRS. Google it and you'll find TONS of information.
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Old 02-19-2012, 02:38 PM
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Now it's internet transactions. State sales tax will be next, followed soon thereafter by some federal tax. The internet is just another cash cow to screw with ...
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Old 02-19-2012, 02:45 PM
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Originally Posted by eastporter2 View Post
I believe that is the threshold when IRS decides you are running a business through ebay/paypal. This was announced in 2009 that the law would go into effect in the 2011 calendar year. Supposedly you have to meet both criteria . . . 200 transactions and $20k in one year to flag paypal/IRS. Google it and you'll find TONS of information.
Yep

Sch C and subject to SE tax too
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Old 02-19-2012, 03:25 PM
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Originally Posted by eastporter2 View Post
I believe that is the threshold when IRS decides you are running a business through ebay/paypal. This was announced in 2009 that the law would go into effect in the 2011 calendar year. Supposedly you have to meet both criteria . . . 200 transactions and $20k in one year to flag paypal/IRS. Google it and you'll find TONS of information.
Thanks for the response. I have exceeded the minimum 200/20000 but I am not a business. I am looking to see how other individuals are dealing with it. Almost all info I see searching google is business related..... some of it even says that you don't need to report until 2013.
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Old 02-19-2012, 04:15 PM
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I handed mine to my accountant, he'll come up with something.
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Old 02-19-2012, 06:13 PM
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Originally Posted by n0averagejoe View Post
Thanks for the response. I have exceeded the minimum 200/20000 but I am not a business. I am looking to see how other individuals are dealing with it.
Yes, you are are a business and Obama wants his share. Healthcare need to be paid, for everyone, so the IRS is going to do the dirty work for him . Read the Healthcare Reform Act and you will see the reporting requirements of businesses. This is the reason you have received these IRS items.

It is only your "fair share" and as described in the post by Tprice, you need a Schedule C and you will pay Self Employment tax also. These are things people need to consider in their business plans/models before experiencing the "cost of doing business".
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Old 02-19-2012, 06:22 PM
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Originally Posted by Curmudgeon View Post
Now it's internet transactions. State sales tax will be next, followed soon thereafter by some federal tax. The internet is just another cash cow to screw with ...
Its called income. You pay federal tax on income -- or at least you are supposed to.
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Old 02-19-2012, 06:28 PM
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Originally Posted by Reel Boobs View Post

These are things people need to consider in their business plans/models before experiencing the "cost of doing business".
Yep see it all the time, think they are making money till I tell them what all they have to pay

Let me ask you this, what were you selling. Was is personal stuff around the house or items you have bought and resold, if the later then you are in business
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