Yeah, Good News– not going to be effective until 2024 for 2025 filing and then $5000. So, for 2023 for filing in 2024, you have to make more than $20,000 before you will get a 1099 from ebay, etsy, facebook marketplace, venmo, paypal, etc. November 21, 2023 news from CBS
Bad News– IRS will tax any income you have from Ebay, Etsy, Facebook Marketplace, Paypal, Venmo, Cash App, etc. if you make $600 or more. What is worse, it that if you are considered a “hobby” you can not deduct any expenses against those sales. If you are considered a business, then you can. Previously you had to sell more than 200 transactions and have income of $20,000 or more to receive a 1099. And, if you are not considered a hobby–you sell for a profit (like who doesn’t sell for a profit), they you are self-employed and have to pay FICA, etc.
Write your Congress representatives NOW (October, 2023)
This IRS change was party of the American Rescue Plan Act and any transactions made after March 11, 2021 that exceeded $600 must be reported to the IRS. Nightmare for sellers and platforms.
Now since this income will be reported on a gross basis for hobby folks, if you are disabled or a senior, this can affect any other benefits you may receive from HEAP, real estate tax allowances, etc. So the net may be is that if you did NOTHING, you might be better off than working to create some incremental income to survive.
Good News-The IRS has delayed its implementation of this requirement until next year-2023. (tax return for 2023)
Still Bad News- This rule will take effect in 2023 unless we unite and protest this new IRS rule. Write your Congressional representatives- senators and representatives to reinstate the $20,000 rule with no limit on transactions.
Senator Schumer- Email- https://www.schumer.senate.gov/contact/email-chuck
Senator Gillibrand-Email- https://www.gillibrand.senate.gov/contact/email-me
NY Representatives- Contact Info- https://www.house.gov/representatives/find-your-representative
