Paypal partners up with the IRS to file transaction reports on Paypal accounts

[augolddigger]

Don't know how many folks have the new policy of paypal partnering up with the IRS to file 1099a forms on all it's users, but I have a couple of "issues" with the wording in the policy changes recently sent out. OK. I can see the $20,000 in transactions, not a problem ( other than Paypal being  wimpy and telling uncle sam to **bleep**, like some companies do!), since I have to account for Ebay anyway. Myissue is with the way the policy is worded and I want to get some clarificaton.

The policy states Paypal will rat you out if you do $20,000 AND 200 transactions (not OR 200 transactions). BIG DIFFERENCE !

So does that mean that someone pulling down $75,000 in sales on Ebay Motors via say 20 sales of various automobiles will skate on the transaction report because they did not do the 200 transactions? I don't see how that is right but that's what the policy states by linking a dollar amount with a set number of transactions like what Paypal sent out to us.

Or do they mean they will rat out anyone who has more than 200 transactions regardless of the total dollar amount, say $10,000 in 350 transactions?

Why the link with transaction numbers unless they are going to turn on you regardless of how much money is involved  OR they intend to GIVE A PASS to folks that sell a few dozen very high dollar items a year? I don't get it, and besides wishing paypal had the balls to take a pass on the whole issue, I don't think the way they sent out the wording in the updates  to us will survive a challenge because they just don't make sense the way they are worded.

Anyone know the real deal, what's really meant by the update ? Are they going to give high dollar low transacton sellerslike ebay motors a pass while sticking it to the rest of us?

[surplusdealdude]

From what I can see, both of the conditions have to be satisfied for Paypal to report - $20,000 AND 200 transactions.  You always had a legal duty to report your earnings to the IRS - if you've been breaking the law, Paypal has no obligation to assist or protect you.

And I have to take issue with your "rat you out" wording.

You don't "partner" with the IRS.  They say and you do or else they get a Court Order and you do.  Not much choice there.

erbay already fought the IRS for years and lost - no sense beating a dead horse.

[profdata]

OP needs to get a clue.

This new lay applys to ALL money transfer companies...

Paypal. Paymate,propay,moneybrokers and 10's if not thousands others

[profdata]

law

[profdata]

Surplus, I don't see why the OP has a problem with it.  Anyoe making 75,000 should be reporting it al ready

[profdata]

Sorry meant $20,000

[augolddigger]

first, already said ( I) (we) need to file all the stuff anyway, part of doing business. As for the rat out phrase, my choice of words and I believe they fit since regardless of what you may think no company is obligated by any court ruling to turn over user lists of any sort, your assertions about Ebay notwithstanding. Ain't so bro. That also is not germain to my post, if you had read it, you would see that it's my personal belief that sellers who sell $100,000 worth of stuff, like ebay motors sellers, in way under 200 transactions, get a pass the way the update is worded, and you seem to confirm my issue with the linkage of a dollare figure to a transaction figure, that some folks won't get filed on that should be, that's all. We all should be treated equally and just have a simple dollar figure there, whether it's $10,000, $20,000 or whatever. Just as an example of something I noted above, I live in new Hampshire and at one point the IRS demanded that the state turn over the names of all commercial fisherman, ( IE a class or group), the state refused. The IRS lost in that battle because it is unconstitutional to get that information on a class basis as opposed to an individual taxpayer, so whatever you are saying about ebay is somewhat distorted ,as ebay probably agreed to something the law could never force them to do. Anyway, high dollar low transaction folks get a pass on reporting,the way i read the Paypal notice.

[profdata]

More rant.....

What user list

In most states if you sell a certain amount of vehicles in a year you will need to be licensed with MVD

We all should be treated equally and just have a simple dollar figure there, whether it's $10,000, $20,000 or whatever.

So a seller that inherits a diamond ring and sells it for $10,000 should be reported by Paypal, like a business that sells $1 million a year.

[augolddigger · Accepted solution]

look, lets compare apples with apples, OK?

Don't pontificate about off topic  stuff.

Your example is tenuous at best since ultimately no tax is due on inheritance at all this year and has to be over a million bucks most other years. And the short answer to your ersatz comparion is, YES by law a transaction report needs to be filed on that sale, just the owner is not liable for any tax.

Tax liability and the ultimimate fairness of a reporting structure are two seperable things. As an antique dealer and auctioneer I have to file transaction reports on my customers if the total they spend in cash with me in any calendar year exceeds $10,000, even though the total may come from several purchases. I can also file an SAR on ANY transaction that seems out of place for ANY amount of money. Same with a jeweler, car dealer, etc. Law has been in place a great many years and always applies regardless of the type of business.

My point, and you can classify it as a rant to minimize my point if you like, is that certain folks that may be high dollar, low transaction ebay sellers don't have to worry about the same transaction reports the rest of the world deals with. My ONLY point. I think that is inherently wrong and unfair to everyone else.

By the way, the dollar figure is $10,000 to trigger a transaction report, not $20,000, just so you know.

And if you think I have a problem with the government digging into classes of folks, rather than individual miscreants, you are right, Thomas Jefferson and I have something in common. Remember the old saw "first they came for the ***** and I did nothing "quote?

I don't want to discuss politics or government theory or teaparty nonsense on this forum. Period.

[lars47601]

I must agree.