PayPal now issues a 1099-K (in 2022) if you move > $600 into your account (they assume you are now in the business of selling goods/services).
If instead money is transferred directly into a bank account, will banks be doing the same thing? I see all kinds of headaches here.
Mel
BUMP--anybody??
If Paypal isn't the bank holding the funds at the start or end of the transaction, it will be subject to 1099-K reporting. Since PayPal isn't a bank they are a third party processor.
Ira Smilovitz, EA Leonia, NJ
Are you saying that if Paypal moves money from Paypal to my bank this is also a 1099-K transaction (assuming totality is > $600 in 2022)?
So I have to add funds going into Paypal and leaving PayPal to my bank?
Hardly worth dealing with PayPal. Too many possible/probable IRS hassles. What about Coinbase to my bank (BTC investments and I would declare capital gains/losses)
Mel
Crypto transactions are more likely to generate IRS interactions than 1099-K transactions. The IRS is already looking closely at crypto (note the check box at the top of Form 1040) and 1099-B reporting begins in 2023. The IRS knows that 1099-Ks report more than just income transactions, so it isn't clear exactly how they will use the information they provide.
Ira Smilovitz, EA Leonia, NJ
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