Tax Concerns with Business/Merchant Accounts

[BCP]

Hello,

I have been using Paypal for a little while, but am considering upgrading to either a business or a merchant account. We run a small, online business of digital goods and would like to accept payment via Paypal.

I remembered reading recently that the US government is now requiring all income collected online to be produced for tax purposes when there is a certain number of unique sales and a level of income reached. While we have always planned on listing any business income, we are wondering if actual W-2s will be sent.

This is a family business and many different people are contributing to it's success. Our concern is if W-2s are produced, one person would shoulder the entire tax burden for every member of the group.

As we are in the process of forming an LLC and are looking into getting a federal ID number. If/when we do, would all tax information go to that specific number, or would it still land as the responsibility of the primary person on this account?

[Misty11]

Hello BCP,

Welcome to the Boards! You have some very good questions and concerns. Here is the PayPal Community Help Forum workshop that may be able to answer all your questions. You can also visit the PayPal IRS page to clarify all your questions. I hope this helps.

Misty

[valperkins]

Hi,where do you go to get your tax id number?

[valperkins]

Thanks.I am self employed dary farmer and my tax id number for it is my social security number.Can I use this number?

[Misty11]

Hello valperkins,

Yes you would use your Social Security Number as the number to add to your PayPal account. When you file your taxes next year your PayPal funds would report to your Social Security Number. I hope this helps.

Misty