IRS Delays $600 Tax Reporting Rules for Mobile Payment Applications

Earlier in 2022, the IRS announced that users of payment exchange platforms such as Venmo, PayPal, and Zelle would need to file a 1099-K if their annual aggregate transactions exceeded $600. With immense concern leading into the 2022 tax filing season by the tax community and lawmakers, the IRS has elected to maintain the existing threshold for reporting. Existing guidelines require those receiving business payments through mobile platforms will only need to file the 1099-K if they exceed 200+ transactions with an aggregate value of at least $20,000. When the proposed updated regulation goes into effect, it will not change the tax liability for individuals and small businesses as they must report all activity as income; however, it will add additional reporting layers.