Only if you don’t confirm your taxpayer status with PayPal by including your tax id number, usually your social security number, in your PayPal account info. However, after hitting $600 dollars in non personal deposit's in a tax year, PayPal will still issue a 1099K which you will need to include with your tax return. Now the fun part. The IRS does not consider amounts received from rebates, coupons, cash back offers, etc., as taxable income. However, PayPal will include all these amounts in the 1099K. To avoid paying taxes on those amounts, you will need to download the itemized list of payments with the 1099K and total up the amount that qualifies as non taxable and provide that to your tax preparer along with an explanation. If you prepare your own tax returns with something like TurboTax, search the help section for this topic. They are aware of it.
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