PayPal and IRS

[redpython]

i think it's 200 payments and/or 20k.

[RichsBallPythons]

According to Ken Swab of PayPal

"PayPal will be reporting the total payment volume for accounts that receive over $20,000 and receive more than 200 payments per year. A business receiving $15,000 in payments per year would not meet the requirements of the legislation. Please see my update to the post above for more clarity on the rest of your questions."

so this means if say i made 10k in 201 payments i will not have to file a claim on the income according to the new legislation coming into affect. As to file you need a 1099

[RichsBallPythons]

So its basically a Honor system with paypal. If you make below the amount paypal wont send the info int othe irs for a 1099 but they expect you to still file on it.


How does state taxes work if all your sales are out of state. I hate taxes and i want to figure this all out before the law goes into effect.

[m00kfu]

So its basically a Honor system with paypal. If you make below the amount paypal wont send the info int othe irs for a 1099 but they expect you to still file on it.


How does state taxes work if all your sales are out of state. I hate taxes and i want to figure this all out before the law goes into effect.

If your state has income taxes, it doesn't matter if your sales are out of state. As far as I know, you're expected to pay taxes on any income as regulated by your state. You're probably thinking of sales tax.

[RichsBallPythons]

If your state has income taxes, it doesn't matter if your sales are out of state. As far as I know, you're expected to pay taxes on any income as regulated by your state. You're probably thinking of sales tax.

yea my bad sales tax. My state i have to pay 6% to them from income earnings.

Whats the % the IRS takes in taxes from incomes. Beings paypal will not report anything under 20k/200 payments. How would one file on that with no 1099.

Im not the best with taxes but i want to know about this law as much as possible.

[RichsBallPythons]

I just got off the phone with the IRS and they said when using PayPal and if your under the 20k they will not be notified about it but you still have to file and pay your 30% tax fee on the profits.

So there for its a honor system for anything thats a small amount done with paypal. Anything above that they said a 1099 will be issued and you will be taxed on that amount on top of your net gain from your actual daytime job.

They said they put this paypal law in effect to stop ebay/paypal sellers form making a lot of money and not paying taxes on it as paypal is offshore. So if your under 20k IRS will not know anything about it unless your a honest person and report it on your taxes.

Keep Voting Democrat and this is what we get.

[redpython]

so the IRS said anything above 20k? what about the 200 transactions? i am confused about the whole deal.

[twh]

[/QUOTE] Keep Voting Democrat and this is what we get.[/QUOTE]