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The IRS Policy on Paypal Issue
9 months ago
This year, due to IRS's fantastic greed and incompetence, we were greeted with a new policy which forces anyone making above $600 yearly on paypal to be taxed for their income they made.
Unfortunately I was affected by this.
Because I don't make much money and only live paycheck to paycheck, the debt that will be placed on me for using paypal will be substantial, and I will likely be forced to search for new methods of payment outside of paypal if this issues persists with the company.
More about this problem here: https://www.youtube.com/watch?v=NCV.....bmcgbW9uZXk%3D
edit: I realize now this is something to do with the IRS specifically cracking down on small business with the new thresholds being lowered substantially so that just about every small business is affected digitally. This was something I wasn't aware of since previously I never made enough on art comms to need to worry about taxes, so this was a first from me. Likely from now on I'll just need to add a tax to all my transactions to protect myself from ending up in more debt during tax season.
If there's to be any good news about this, at least I now know that art comms has been an extremely viable source of income, as it makes about 45% of my total income!
I apologize for any confusion I may have caused for anyone. I'm still very young and trying to learn about this stuff as I go, as I wasn't really taught much about this.
Unfortunately I was affected by this.
Because I don't make much money and only live paycheck to paycheck, the debt that will be placed on me for using paypal will be substantial, and I will likely be forced to search for new methods of payment outside of paypal if this issues persists with the company.
More about this problem here: https://www.youtube.com/watch?v=NCV.....bmcgbW9uZXk%3D
edit: I realize now this is something to do with the IRS specifically cracking down on small business with the new thresholds being lowered substantially so that just about every small business is affected digitally. This was something I wasn't aware of since previously I never made enough on art comms to need to worry about taxes, so this was a first from me. Likely from now on I'll just need to add a tax to all my transactions to protect myself from ending up in more debt during tax season.
If there's to be any good news about this, at least I now know that art comms has been an extremely viable source of income, as it makes about 45% of my total income!
I apologize for any confusion I may have caused for anyone. I'm still very young and trying to learn about this stuff as I go, as I wasn't really taught much about this.
you can make up to 5k on this year's taxes on a given platform without having to worry about a 1099k.
next year's taxes will be 2.5k
and then the following, supposedly, the $600 line will be drawn.
(& iirc If you have commissioners pay you as 'services' rather than as 'friends' the service fee is factored in against taxes due as an expenditure.)
edit:
mb mb! some states have decided to not keep the national delay X.x so if you live in one of those states the limit might well already be 600 Dx argh
https://www.paypal.com/us/cshelp/ar.....pdate-help1131
On a side note really hope the promise that tips will become non-taxable goes through because about 3/4 the money I make from GrubHub deliveries are tips.
Best suggestion I can coming up with other than complaining to your congressman is try to estimate your income throughout the year to do the same. My brother uses QuickBooks for all his business income and expenses and it basically does the estimations for him.
I dont know how is it in America - do you pay taxes as self-employed? So if it is, it means you will paypal taxes and self-employed taxes?..
It sometimes goes the other way though; it used to be you had to report all interest, but now they don't expect you to if you made less than $5 in a year.
Self-employed people do indeed have to pay tax; part of it is income tax everyone has to pay, but they also have to pay self-employment tax on top of that, because when you're an employee, your employer pays half of that for you, but when you're self-employed you pay it all yourself (this basically covers things like social security taxes and other payroll taxes).