Starting this year mobile money apps like PayPal, Venmo and Zelle have to report annual commercial transactions to the Internal Revenue Service if they are more than $600 per year. The change was signed into law as part of the Covid-19 response bill and passed last year in March.
The prior rules on that matter made it so that mobile payment apps like PayPal had to tell the IRS when a person had hundreds of commercial transactions, over 200 of them in one year which exceeded $20,000 in revenue. But now if someone is getting more than $600 per year on a payment app they need to report it and file IRS Form 1099-K. This isn’t for personal charges to friends and family and is just for goods and services that are commercial. The news comes as a shocking change to some though it was expected for some time now. Anyone who accepts payments through those apps is going to need to remember this. The changes to the mobile payment apps like PayPal, which is one of the most popular of its kind in the world, is something that just recently took place at the beginning of the year. This is their effort to continue keeping track of those commercial exchanges and making sure that proper reporting is done on the commercial exchanges in a certain way. It isn’t just for PayPal either but also impacts other payment systems that are also popular today with millions like Cash App and other mobile payment companies today.