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The IRS said it is delaying a controversial requirement by one year that would have led to more online sellers and gig workers having income reported to the nation's tax agency.
The rule change would have required payment platforms such as Venmo, Paypal or Cash App to send tax forms called 1099-Ks to anyone receiving over $600. Previously, such payment services only had to report users' income to the Internal Revenue Service if they had more than 200 transactions, exceeding $20,000 in revenue.
Online selling platforms including eBay, Etsy and Poshmark had pushed back hard against the proposal to lower the reporting limit to $600, claiming it would create confusion and make it harder for sellers to earn a living. Meanwhile, Republican members of Congress said the plan was an example of government overreach that would ensnare people using apps to pay friends and family.
"The IRS and Treasury heard a number of concerns" about the changes, acting IRS Commissioner Doug O'Donnell said in a Friday statement. "To help smooth the transition and ensure clarity for taxpayers, tax professionals and industry, the IRS will delay implementation" of the new rule, the statement said.
"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," he added.
www.cbsnews.com
The rule change would have required payment platforms such as Venmo, Paypal or Cash App to send tax forms called 1099-Ks to anyone receiving over $600. Previously, such payment services only had to report users' income to the Internal Revenue Service if they had more than 200 transactions, exceeding $20,000 in revenue.
Online selling platforms including eBay, Etsy and Poshmark had pushed back hard against the proposal to lower the reporting limit to $600, claiming it would create confusion and make it harder for sellers to earn a living. Meanwhile, Republican members of Congress said the plan was an example of government overreach that would ensnare people using apps to pay friends and family.
"The IRS and Treasury heard a number of concerns" about the changes, acting IRS Commissioner Doug O'Donnell said in a Friday statement. "To help smooth the transition and ensure clarity for taxpayers, tax professionals and industry, the IRS will delay implementation" of the new rule, the statement said.
"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," he added.
IRS says it will delay requirement to report $600 in gig work on taxes
Most online sellers will be spared from tracking and reporting side-hustle income on their taxes for at least another year.
www.cbsnews.com
