2007-01-06 23:00:18 · 3 answers · asked by locknkey 3 in Business & Finance ➔ Taxes ➔ United States
Paypal reports two types of transactions to the IRS. If you have a paypal savings account, paypal reports the interest paid to you on Form 1099-INT, and a copy goes to IRS.
If you had any cash-type transactions (meaning paid by checking account) for any single transaction over $10,000, this is reported as well.
Also, the IRS can ask paypal about any transactions on debit cards that are sourced from or to foreign countries that are typically tax havens.
ebay does not report transactions to IRS.
The WealthBuilder
Enrolled Agent / Tax Specialist
2007-01-07 01:22:44 · answer #1 · answered by WealthBuilder 4 · 2⤊ 1⤋
As I understand it, Paypal is really just an internet bank, in the sense that people hold accounts there and money can be transferred from one account to the other. If my understanding is correct, I do not see that Paypal has any need to report transactions to the IRS. However, anyone who has sent you money may have a reporting requirement, depending on the services you provide, to whom and for how much. If that is the case, they will have to send you a form 1099-MISC by the end of January and report it to the IRS by the end of February.
2007-01-07 08:44:47 · answer #2 · answered by skip 6 · 1⤊ 1⤋
Now that you have mentioned it the IRS will start requesting that information and catch us all on our Internet purchases. We are all busted.
2007-01-07 11:11:41 · answer #3 · answered by ? 6 · 1⤊ 1⤋