Regarding paypal tax reporting requirements
Twinturbo
Posts: 493
For paypal in regards to their 20k 200 transaction reporting requirement
Does this include paypal gift payments as well?
Any info is greatly appreciated
Does this include paypal gift payments as well?
Any info is greatly appreciated
0
Comments
idk
.
my guess is the gift thing is excluded, up until someone like the IRS figures out it was used to circumvent the reporting requirements, then it is interest and penalties time.
and I suppose you won't want to call paypal to alert them to your activities, perhaps asking someone who is in a different position than you to call will answer your question.
Try having several different forms of income.
"the $20,000 will be calculated by looking at a seller’s gross payment volume for sales of goods or services. Gross amount means that any adjustments for credits, cash equivalents, discounts, fees, refunded amounts or any other amounts will not be netted out
No Way Out: Stimulus and Money Printing Are the Only Path Left
<< <i>this is actually a legal question.
my guess is the gift thing is excluded, up until someone like the IRS figures out it was used to circumvent the reporting requirements, then it is interest and penalties time.
and I suppose you won't want to call paypal to alert them to your activities, perhaps asking someone who is in a different position than you to call will answer your question. >>
More likely used to circumvent fees than taxes.
<< <i>from the paypal website:
"the $20,000 will be calculated by looking at a seller’s gross payment volume for sales of goods or services. Gross amount means that any adjustments for credits, cash equivalents, discounts, fees, refunded amounts or any other amounts will not be netted out >>
I assume that you can edit out certain items if it's worth the trouble.
If you're audited, then the CRA (IRS) will get ALL of your Paypal activity. (that I would presume includes transactions such as this site's BST forum).
So it's best to claim everything!!
Another thing us Canadians have to be wary of is to keep our 'sales' under 30K, because if we exceed this amount, then we need an HST license and we would have to charge HST on all transactions (HST is an additional 13%).
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<< <i>What is HST? Is that like The Affordable Health Care Tax in the U.S ? >>
LOL...
No, HST doesn't stand for Health Services Tax but rather "Harmonized Sales Tax". (a combination of provincial and national sales tax charges). YIPPEE!!!!
"“Those who sacrifice liberty for security/safety deserve neither.“(Benjamin Franklin)
"I only golf on days that end in 'Y'" (DE59)
<< <i>from the paypal website:
"the $20,000 will be calculated by looking at a seller’s gross payment volume for sales of goods or services. Gross amount means that any adjustments for credits, cash equivalents, discounts, fees, refunded amounts or any other amounts will not be netted out >>
The fact that PayPal might not report PayPal gifts does not mean that they are not taxable income, especially if the "gifts" really were payments for merchandise what were obtained by circumventing normal PayPal fees. If this is the case and the IRS finds out, then I don't think things will turn out very well for you. It looks like tax evasion if someone were to report you or if you were audited.
<< <i>aren't there irs taxes on gifts at some point? >>
Yes. The last time I heard (and it is my understanding that it has gone up),anything more than $13,000 is taxable per year and anything more than $1,000,000 in a lifetime is taxable (and this is per an individual making a "gift" to you). Again, I would consult with a CPA.
Straight from the horse's mouth: http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Frequently-Asked-Questions-on-Gift-Taxes
Gifts of cash , up to a certain amount are not taxable to
the recipient . A "buyer" receives a gift card from who ever
during the holidays . For arguments sake , the lucky dude is
not liable for income tax . This lucky dude purchases an item
from you , and pays with his gift card . The money you receive
is not a gift . It is a payment in exchange for your merchandise .
As mentioned in previous posts , one should ask a qualified
individual in the income tax field . We are merely collectors
and have our own 'situations'
While a true gift under IRS exclusion limits (currently $13K per donor) does not have to be reported by the recipient, calling sales income a gift does not exempt it from income reporting requirements. Not reporting a monetary gift that is in reality sales income could easily lead to tax fraud charges. Regardless of how paypal treats the reporting of gift payments to an account, a paypal account holder receiving gift payments that are in reality sales income needs to ask himself "is it really worth it to not report the income."
No Way Out: Stimulus and Money Printing Are the Only Path Left
<< <i>For paypal in regards to their 20k 200 transaction reporting requirement
Does this include paypal gift payments as well?
Any info is greatly appreciated >>
Income ?
Report ! It's not that complex, friends.
Subtract cost basis from sale price , minus associated fees and costs and report the profit or proceeds as income.
Gifts are still monetary gain and trackable. Have some documentation or report it all. ... but report.
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