Here’s what we know…
Are you sending or receiving money over the phone via apps such as Venmo, Cash App, or PayPal? Rumors started swirling about the fact that the IRS may now start taxing you if you send money via phone apps if they amount to $600 or more.
While this isn’t a new law, there are new IRS regulations that make it easier for them to tax previously undisclosed income paid through apps.
According to Life Hacker, starting January 1st, 2022 Americans will now have to fill out 1099 forms if they process transactions of $600 or more in a single calendar year.
Technically, Americans won’t have to pay additional taxes, since it applies only to income that should be reported to the IRS already. However for those Americans who haven’t been keeping up with reporting income less than $20,000 paid through these apps should do so quickly.
What is most important to remember is that these rules ONLY apply to income related transactions. This only applies for money you have made on services or goods sold for profit.