2. misc-audio
  3. 192416-85928

2024 Form 1099-K IRS tax reporting threshold on PayPal?

I know, everyone wants to know about this. Below are the transaction limits for PayPal:

The IRS has recently announced an additional delay in implementing the new $600 USD reporting threshold for goods and services transactions. The 2024 requirement for Form 1099-K reporting to the IRS is $5,000. Additionally, PayPal and Venmo will file Form 1099-K for any customer who was subject to backup withholding during 2024, regardless of total payments for the year. In the case where an individual state has a lower threshold, PayPal and Venmo will report accordingly.

If you live in the following US states, you’re subject to a lower reporting threshold:

    Vermont, Massachusetts, Virginia, Maryland: $600 USD in gross payment volume from sales of goods or services in a single calendar year, regardless of the number of transactions.
    Illinois: over $1,000 USD in gross payment volume from sales of goods or services in a single calendar year and four or more separate transactions.

 

This is actually good news for me. I sold a bunch of things ealier this year which put me above $600 but below $5000.

If you're in a 5k state and underneath the 5K threshold, sell em if you got em!

I believe for tax year 2025, the limit gets cranks down to $2500

Tax year 2026 hits the $600 mark

 

All this info is on the PayPal website. Click on the gear>Statement & Taxes tab, and the info is there

 

 

elrod
koestner
671 posts
 

My state, Florida, has no income tax, but what about the Federal?

bigtwin's avatar
bigtwin
1,205 posts
 

Are you not being taxed only on profit, or capital gain as it may be called. Has anyone in the history of selling used equipment even made a profit? I fail to understand why the government wants to bother with this. What am I missing?  Is President Musk planning to pay off the national debt by collecting sales tax from Audiophiles?  

mitch2
4,006 posts
 

Don't make this political.  BTW, it was placed into effect well before the recent election.

This is simply more paperwork for us.  Keep records on what you pay for stuff (maybe copy the for-sale ad and write your paid amount and method of payment) and provide those to your tax preparer to establish a basis for the items associated with your 1099K.  Mine will be like yours, a loss, so no tax obligation.

More to discover