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You are here: Home / Business / New IRS $600 Reporting Rule | More Taxes on Small Business & Side Hustles?

New IRS $600 Reporting Rule | More Taxes on Small Business & Side Hustles?

January 26, 2022 by Jennifer Moore Leave a Comment

There still seems to be a lot of confusion around the new IRS tax reporting threshold of $600 starting in 2022.

No, the actual IRS tax law has not changed, only the IRS reporting requirements for online payment platforms. Anyone who generated a profit from selling anything online is expected to report income and pay income taxes regardless of whether or not they received a 1099-K. This includes popular online third-party payment processors Etsy, eBay, PayPal, Venmo, Facebook Marketplace, and Cash App.

Prior to this year, the old threshold was $20,000 per year and at least 200 transactions.

According to Zelle, this platform is actually exempt from the IRS reporting law
https://www.zellepay.com/faq/does-zelle-report-how-much-money-i-receive-irs

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Previously, the threshold was $20,000 and at least 200 transactions. This rule is part of the American Rescue Plan Act of 2021, applying to anyone who receives payments for goods/services processed by third-party payment networks. Income should be reported on an individual or business’s tax return.

Joining me in this episode is Mark Tew, CPA – known as Not Your Dad’s CPA – to clarify some of these items, answer questions, and help you tackle small business finances.

Connect with Mark – Not Your Dad’s CPA online!
https://www.youtube.com/c/NotYourDadsCPA
Accounting for Online Sellers free Facebook group:
https://www.facebook.com/groups/accountingforsellers/
Reseller Tax Academy: https://www.resellertaxacademy.com/
Mark’s website: https://notyourdadscpa.com/
https://www.instagram.com/notyourdadscpa/

Disclaimer: this video is for informational purposes only and does not constitute financial, accounting, legal or tax advice. Please consult a licensed professional about your own specific situation and small business needs.

The IRS Is Cracking Down on Small-Time eBay and Etsy Sellers
https://money.com/tax-1099-k-600-ebay-etsy/
It’s going to become harder to avoid telling the IRS about income from selling stuff online. Here’s what to know
https://www.cnbc.com/2021/03/26/its-going-to-get-harder-to-avoid-telling-the-irs-about-income-from-online-sales.html

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Filed Under: Business, Etsy, Original Reporting Tagged With: 1099 k reporting, 600 irs explained, accounting for etsy, etsy 1099 k form, etsy 2022, etsy accounting, etsy bookkeeping, etsy income, etsy sales tax, etsy seller, etsy taxes, irs 2022, irs changes, irs changes 2022, irs reporting 600, irs tax online sellers, irs taxing side hustles, irs threshold, mark tew, mark tew cpa, mark tew not your dad's cpa, not your dad's cpa, online reselling, reporting income to irs, selling on etsy, sewing report, small business accounting, tax changes 2022, taxes etsy

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