New tax rule applies to mobile payment app users
It applies to any payment for a good or service, including tips.
LANSING, Mich. (WILX) - Payment mobile app providers must now issue users a 1099-K form if they pass the IRS reporting threshold for their state.
Anyone who used apps such as Venmo, PayPal, or CashApp, will not see any additional taxes imposed upon them. The rule is meant to make it harder for people to evade paying taxes owed.
The app providers must issue the form to users and the IRS if, combined, they total more than $600 a year. Previously, they only needed to do so if they had more than 200 business transactions in a year that totaled at least $20,000. This applies to any payment for a good or service, including tips.
Individuals who have sold cryptocurrency on Venmo during the 2021 tax year may receive a form 1099-MISC, irrespective of their state of residence.
Learn more about the 1099-K form HERE.
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