The IRS is tracking payments over $600 on Paypal, Venmo, Zelle and Cash App starting 2022

If you are the business owner and get paid through digital apps like PayPal, Zelle, Cash App or Venmo, earnings over $600 will now be reported to the IRS. A provision from the 2021 American Rescue Plan, which went into effect on Jan. 1, directs third-party payment processors to report transactions received for goods or services totaling over $600 per year to the IRS.

Third-party payment companies will issue you a 1099-K tax form each year if you earn $600 or more annually in income for goods or services. This tax form might include taxable and nontaxable transactions, particularly if the account is for both business and personal use.

Creating a separate business PayPal, Zelle, Cash App or Venmo accounts might be the best way to manage your professional finances.

CONTACT US TODAY if you have any questions.

Sincerely,

Maryna Varabyova, CPA

(877) 677-3737

vm.acc4u@gmail.com