Quote:
Originally Posted by nwobhm
If it’s all just false BS then why was it lowered to $600?
Not saying you’re wrong… certainly not saying you’re right either. Whole lotta experts running their mouth yet it hasn’t happened yet.
Only way to know what will play out is watching it happen. When has trusting that .gov has nothing but honorable intentions played out well?
Just sayin’….
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You are confusing and mixing different things up. The BS Adam was referring to had to do with the response he was making to some about the IRS coming after them, about having to pay tax on the total amount of a 1099 they receive and not being able to deduct what they paid for the items they sold, and about the IRS not realizing you may not always have a receipt for cash purchases and not allowing a taxpayer to estimate what they may have paid and be able to deduct it.
The lowering of the reporting threshold to $600 is a completely different and separate issue. And I've gone into that and explained to everyone on this forum before the real reason behind the lowered $600 threshold. In an earlier post I suggested doing a search of all my old tax related posts in numerous other threads, to find where I've already explained this in great detail. The Cliff Notes version is that the reduced reporting threshold to $600 for 1099-K forms is so that it aligns and agrees with the same reporting threshold that already for years was being required for people/businesses filing 1099-NEC and/or 1099-MISC forms to report the amount of non-employee (independent contractor) compensation they may be paying someone, or some unincorporated business, they hire to do something for them. The problem the government (not the IRS) realized is that a lot of people started paying these individuals and unincorporated businesses through platforms like Paypal, and weren't always properly sending in the appropriate 1099 forms to report this income they were paying them. Remember, it is Paypal Goods and SERVICES. The lowered threshold was to get after the SERVICES side of such Paypal and other third-party platform payments, to make sure the IRS was being informed about them. The lowered threshold wasn't primarily to get after people selling stuff on Ebay, it was to get after the people not reporting payments they were making to those doing work for them that aren't their employees. Unfortunately, payment platforms like Paypal don't differentiate between Goods (like things being sold on Ebay) and Services (payments made to a non-employee for work they do for you). So, the government in fixing the reporting threshold for service payments so it is consistent across all the different types of 1099 reporting that may be required, unfortunately ended up affecting the reporting of sales of goods as well. If you have any suggestions you can give the government, Paypal, or anyone else involved in this, how anyone can easily and without a ridiculous amount of work and effort, differentiate and segregate the reporting threshold of these third-party payment platforms so they would only apply the $600 threshold to just non-employee payments for services through them, while at the exact same time leaving the threshold for payments for goods through them at the old $20,000 level, I bet they'd be all ears. Good luck in that though
There are no real bad intentions here, the government was just trying to make the reporting requirements consistent across all the different 1099 forms. The real villains are those that have abused the system and law by not properly reporting like they were supposed to all along. Faced with our government having to pay the bills, would you rather our government enact and add even more taxes we have to pay, or, would you rather they actually start getting after those people and businesses that aren't reporting all their income and properly paying their taxes?
12-11-2022, 04:10 PM
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