The IRS recently announced that payment apps such as PayPal, Venmo, and CashApp will be required to issue 1099s to small businesses and self-employed persons. Here’s what you need to know.
New rule is targeted at very small businesses and individuals with a side hustle
Starting in tax year 2022, payment apps will be required to report to the IRS total payments received by a business account in excess of $600 annually. This new requirement is clearly targeted at the smallest of small businesses and at individuals with a side hustle, as the prior rule only required a payment app to report when an account received more than $20,000 and had 200 or more transactions within the year. These micro-businesses that collect less than $20,000 a year previously did not fall under the 1099 rule, but will now be treated like every other business, large or small…
Read the article on Entrepreneur here.