[Forbes] IRS Announces Big Changes To Form 1099-K, Including Another Reporting Delay

IRS punts again.

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I could not see the Forbes article, but found this.

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From the Forbes article, which echoes much of the IRS press release:

IRS: It’s too much work and will cost a lot more in time spent answering questions than we recover. ■■■■ it we’re not doing it.

$600 in 1954 is worth $6,862.55 today

Definitely, at a $600 threshold. The proposed 2024 $5000 might be slightly more reasonable for 2020s businesses and avoid the big jump to $20k (made in 2012, pulled back in 2021, but what is being postponed here).

For perspective, my parents weren’t even born yet in 1954. :grimacing:

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Even $5000 is low if there is one person in charge of making all the rent payments for roommates for the year.
Don’t be the one in charge of phone bills, or internet service, or cable/subscriptions.

The big issue is that there is no way to “easily” determine if money transferring is business or not.
Hopefully the IRS is working with the dozens of payment processors/apps to try and come up with some sort of system to identify transaction types.

Think about it. Microsoft and Big Pharma can transfer their patents to subsidiaries in Ireland and Luxembourg to lower their taxes, but we have to prove what we paid for an item we purchased 20 years ago and sold on Amazon or at a garage sale to the IRS to avoid being taxed on a sale we lost money on.

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This is retroactive? Didn’t read yet

No

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No. They put a temporary hold on the $600 for 2022 and have now officially extended that hold to 2023, so the 1099-K threshold will still be $20k for 2023.

It doesn’t mean that earnings under $20k shouldn’t be reported; it just means that Sellers won’t receive 1099-Ks.

They have proposed a $5k transitionary threshold for 2024, to ease from $20k (2023) to $600 (2025).

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Which may go out the window if the supreme court overturns the Chevron precedent as is expected this session.

Even this action might be illegal if Chevron is overturned, since it is not supported by specific statute.

The timing of the current may be because I did some tax planning today and decoded to shelter part of my earnings this year in my IRA because I don’t need the money and I am pulling out a significant RMD from the IRA.

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