requesting Tax id number for IRS

[granola]

Has anyone received the following message on their Paypal "My Account" page.  I received an email requesting my tax id number or SS number several weeks ago. I immediately forwarded it to Paypal and they said it was a scam.   This message showed up on my account page and has stayed there and I am continuing to get emails requesting the same.  Any help?   Thanks.

***Please provide us with your tax ID number. Your tax ID number lets us
send you Form 1099-K, as required by the IRS under certain conditions. Find more
information about the new tax rules and why we need your tax ID at
www.paypal.com/irs. Provide
your tax ID number now.***

[PayPal_Andy]

granola-  While I'm not sure why our system would read that email as spoof, I can definitely tell you we are requiring accounts to provide SSN/Tax IDs to comply with new IRS regulations.  You can check out the link you provided (if you haven't already) for more info, but if it's a banner in your PayPal account, then that sounds 99.8% legitimate; and you can always contact our customer service to verify that.

Andy

[M71Z11]

Hi Andy - hope you can help I'm not getting any answers from Paypal on this as yet.

I have a verified US Paypal account and US bank account - I'm an Australian citizen not resident in the US.

There are 3 options provied but nothing for non US account holders to provide info. The FAQs provide this info::

Are non-US PayPal accounts affected by this new law?

Internal Revenue Code Section 6050W requires PayPal’s non-US subsidiaries to comply with the new law. As a result, non-US account holders may need to certify their non-US status and their address. US sellers using a non-US PayPal account may be required to provide a tax ID number (Social Security Number (SSN), Employer Identification Number (EIN), or Individual Tax Identification Number (ITIN)) for those accounts. We will provide additional guidance on these requirements when available.

"As a result, non-US account holders may need to certify their non-US status and their address."

Do I need to do this and if so how ?

Your advice is much appreciated.

[PayPal_Andy]

Be more than happy to help you out there M71Z11.  We ran this by a couple of departments who helped out with our IRS chat a few months ago and here is their reply:

"The general policy is that sellers who are asked to provide a TIN must add a TIN to have full use of the US account.  If they don’t have one, their account use may be limited.  If they want full account use, they will need to open a new one in the country where they are located or apply for a TIN and add it to their US account."

So basically, if you're operating with a US account, you need to be able to provide documentation showing you're paying your US taxes.  If you can't, you need to open and operate an account in the country you're in.

Hope that clears it up for you.

Andy

[ohbrudder93]

Andy,

Can you tell me why I would be getting this message? It says I must file the tax form when I have reached $20,000 in sales AND 200 in sales. While I have reached 200 sales, I'm not even at $10,000 in sales yet and don't really see even hitting $15K before the end of the year. Why must I provide my SSN so early? Why not at, say, $15K in sales? I'm just a little wary, as a seller of little things from my house only, to be providing this info when I'm certain I won't be filing the tax form this year

thanks 🙂

[Phoenex]

Hi Ohbrudder93, I have the same situation and can't get a straight answer from anyone. I am planning on contacting the IRS myself and ask if Paypal has the right to demand the Social Security number if we do not meet the requirements for the 1099.
I've been a victim of I.D. thief too many times to give out my SS so freely.
Phoenex

[INSPIREDNZ]

Hi Andy, 

Thanks for this info.

Is it for certain that Paypal is not going to allow people to hold a US Paypal account without an IRS number?

Why is it not possible to get some kind of foreign account holder status? I have two bank accounts in the USA and both simply required me to complete a foreign status form when opening them, and that's all. My US paypal account is linked to one of these US bank accounts.

I have a US paypal account for a number of important reasons. I also have one from New Zealand (my country of residence), but I generally only use my US one. Partly because it gives me a Paypal Debit Card, partly because most of my payments (in and out) are to/from people and companies in the USA, and partly for numerous other reasons. I do not wish to lose my US Paypal account simply because I don't have an IRS number, especially when as a non-US resident I don't need an IRS number.

I understand Paypal has reporting requirements to the IRS, just as the two USA banks I use have. But in the instance of non-US Paypal account holders those reporting requirements should be little more than passing on my foreign status (just as the banks pass this on).

Please advise if there is any way around this.

Thanks,

Jonathan

[z11m71]

Good question - why can't non US nationals/residents with a US bank account hold a US paypal account - there so many reasons why one would need a US paypal account. I've just had to close my account after 11 years, it makes no sense.

Surely you could furnish docs to prove you are not a US citizen and don't live in the US just as you need to do when opening a US bank account.

Is there a work around ?

[PayPal_Andy]

Happy to help ya'll out.  In order:

ohbrudder93-  You can check out my answer here if you want more details, but basically if there's any possibility of you hitting the requirements for reporting, you have to provide that information. So if you've hit one side of it and you're coming up on the other, even if you don't hit it, you still have to provide the info the government is asking for.

INSPIREDNZ  & z11m71-  Since your questions sorta touch on the same topic.  While I completely understand where you're coming from regarding the whole international resident/non-resident issue, here's the situation.  Not all of PayPal's features are available in every country (as you mentioned).  But in some cases, this is because in some countries, not all of our features can be available. This could be anything from governmental regulations to banking regulations and so on.  So if you're creating an account in the US to get access to features that aren't allowed where you live, then there may be heavier repercussions than you just having an foreign account.  Therefore, we can't allow that.  And if you're doing enough business for us to request tax information, it just brings that fact to our attention that much faster.

Andy

[gm1230126]

Ansy,

My understanding on the law change requiring Paypal/Ebay to report to  the IRS  was this.  Any user completing 200 transactions or doing a total of $20,000 in sales was required to be reported.  So If I'm at 96 tranactions with a total of less than $12,000 in purchases and sales... why is Pay Pal threatening and hounding  me  and telling me I must give them my soclal security number?...especially when there is no way I will ever hit 200 transactions or $20,000 in total purchases and sales.  Ebay and PayPal are about to be a thing of my past with all thre recent badgering.

https://www.thepaypalblog.com/2008/08/proposed-irs-reporting-requirements-become-law/