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App payment confusion causes IRS to delay $600 sales reporting threshold — again on November 21, 2023 at 6:00 pm Business News | The Hill

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Taxpayers and gig workers who use apps such as Venmo and Paypal to make money selling personal goods and services don’t have to worry about the new $600 threshold for reporting sales on form 1099-K to the IRS this year.

Confusion about the new rule among taxpayers and payment companies, along with operational problems relating to unnecessary paperwork, have once again caused the agency to delay the requirement, initially passed in 2021 as part of the American Rescue Plan (ARP).

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The threshold for tax year 2023 will remain at $20,000 and more than 200 transactions, the same as it was last year, IRS officials told reporters Tuesday. Next year, the IRS expects to enforce a $5,000 limit as a transitional threshold on the way down to the $600 required by law.

The ARP originally required apps and online marketplaces such as eBay and Ticketmaster to report payments of more than $600 for the sale of goods and services on a Form 1099-K starting in 2022. The forms then get sent to taxpayers and the IRS.

But people are having trouble differentiating between sales made for personal commercial gain, which are taxable, and payments made to friends and family for personal expenses and transfers, which are not, officials said. 

“The Form 1099-K could be sent to anyone who’s using payment apps or online marketplaces to accept payments for selling goods or providing services. This includes people with side hustles, small businesses, crafters and other sole proprietors,” the IRS said in a Tuesday statement. “However, it could also include casual sellers who sold personal stuff like clothing, furniture and other household items that they paid more than they sold it for.”

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“Reporting requirements do not apply to personal transactions such as birthday or holiday gifts, sharing the cost of a car ride or meal, or paying a family member or another for a household bill. These payments are not taxable and should not be reported on Form 1099-K,” the IRS says.

There’s also confusion about what to do if items are sold at a loss, which shouldn’t be taxed but can still generate forms to be sent out to taxpayers, leading to a potential mess of paperwork.

“Selling items at a loss is not actually taxable income but would have generated many Forms 1099-K for many people with the $600 threshold. This complexity contributed to the IRS decision to delay the additional year to provide the agency time to update its operations to make it easier for taxpayers to report the amounts on their forms,” the agency said.

Taxpayers selling items at a loss are supposed to “zero out” the payment by reporting it on both their tax return and on Form 1040, Schedule 1. 

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“This will ensure people who unnecessarily get these forms don’t have to pay taxes they don’t owe,” the IRS said.

Officials said the agency has the authority to unilaterally make these changes in implementing the law, citing “broad discretion” provided by the Internal Revenue Code in administering the tax law.

They did not give an estimate of how much additional revenue the government is expected to receive as a result of the lowered threshold.

In order to be compliant with the $600 threshold, which was supposed to take effect this year, companies offering payment apps and sales platforms have been asking customers for their personal tax information, leading to some distress.

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The IRS is in the middle of the largest overhaul to its daily operations in decades, a result of an initial $80 billion funding boost to be spent over the subsequent decade as a provision of the 2022 Inflation Reduction Act.

That funding increase has since been scaled back by about $20 billion a result of Republican opposition, but the operational overhaul is continuing. Further cuts to the additional funding could bear out as part of the appropriations process next year, as well.

The overhaul includes an online tax filing system that could effectively replace many pieces of private software designed to help people file their taxes. The system is set to debut in 2024 with a pilot program.

“The IRS will explore providing taxpayers the option to file certain tax returns directly with the IRS online,” the agency said as part of its strategic operating plan for the funding boost.

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​Business, Personal Finance, 1099-K, american rescue plan, Form 1099-K, IRS, IRS funding boost Taxpayers and gig workers who use apps such as Venmo and Paypal to make money selling personal goods and services don’t have to worry about the new $600 threshold for reporting sales on form 1099-K to the IRS this year. Confusion about the new rule among taxpayers and payment companies, along with operational problems relating…  

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Public health groups alarmed at White House delay of menthol cigarette ban on December 6, 2023 at 10:48 pm Business News | The Hill

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The Biden administration is delaying a decision on whether to ban menthol flavored cigarettes amid intense lobbying from critics including the tobacco industry, industry-backed groups and some Black criminal justice advocates. 

The delay is alarming public health groups, which fear that the White House could cave to pressure and delay the rule indefinitely, especially against the backdrop of President Biden’s reelection bid. 

The target date for releasing the rule was initially August, which was then pushed back to the end of the year. The White House in its regulatory agenda released Wednesday set a new target for March 2024.  

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“Any delay in finalizing the FDA’s [Food and Drug Administration’s] menthol rule would be a gift to the tobacco industry at the expense of Black lives,” said Yolanda Richardson, CEO of the Campaign for Tobacco-Free Kids. “We urge the administration to keep its promise and issue a final rule by the end of this year.” 

The Obama administration solicited comments for potential regulation of menthol cigarettes in 2013, but it never proposed a rule. Then, in 2018, the Trump administration revisited the issue under former FDA Commissioner Scott Gottlieb.  

But Trump’s FDA also failed to issue a formal rule. So when the Biden administration’s April 2022 proposals for a ban on menthol and flavored cigars were released, they represented a significant step forward. 

Public health groups said based on past history, they’re worried the delay will go beyond March. 

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“We were expecting to see final rules in August this year. It’s now December. And so an additional delay to March certainly begs the question, how much longer are we gonna have to wait? How many times are we going to punt this?” asked Emily Holubowich, national senior vice president of federal advocacy at the American Heart Association.  

“The science is clear. The rules need to be released now,” Holubowich said. 

The FDA said it remained committed to issuing the rule “as expeditiously as possible.” 

“At this stage in rulemaking, the FDA is limited from further discussions about the rules before they are published,” an agency spokesman said. 

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A menthol ban has been more than a decade in the making and would be one of the most consequential policies from the FDA since it began regulating tobacco in 2009. Health officials and tobacco control advocates have said such a move could save hundreds of thousands of lives, particularly among Black smokers. 

An estimated 85 percent of Black smokers use menthols, according to the FDA, compared with 30 percent of white smokers. About 40 percent of excess deaths due to menthol cigarette smoking in the U.S. between 1980 and 2018 were among African Americans, according to the Centers for Disease Control and Prevention (CDC). 

David Margolius, director of public health for Cleveland, said the delays in issuing the ban have left him frustrated.  

“What it says to us is that cities like Cleveland are being left behind,” Margolius said, adding that the city’s smoking rate is 35 percent. The national average is around 11 percent.  

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“Every month that they kick the can down the road, more lives are lost in places like Cleveland. The right time to do this was as many years ago as possible. We’ve got to right the wrongs of the past. And so pushing this further along, that doesn’t help anybody,” Margoulis said. 

The White House has been reviewing the ban since October, typically the final step before the rules get released. 

But the White House Office of Management and Budget has been holding dozens of meetings with outside groups about the policy since October, including retailers, civil rights groups and law enforcement officials. According to records, almost all the meetings have been with groups that oppose the ban.  

Representatives from Rev. Al Sharpton’s National Action Network along with civil rights attorney Ben Crump, tobacco companies, former lawmakers and leaders of a Black law enforcement group attended a Nov. 20 meeting with senior Biden administration officials — including FDA Commissioner Robert Califf, Health and Human Services Secretary Xavier Becerra and White House domestic policy advisor Neera Tanden — to lobby against the ban. 

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Sharpton has faced criticism for taking money from the tobacco industry. The New York Times reported in 2019 that tobacco giant Reynolds American enlisted him to lobby against a New York City ban on menthol tobacco products.  

The National Organization of Black Law Enforcement Executives, which requested the meeting, has also received funding from tobacco companies, including Reynolds. 

The groups argue a menthol ban will lead to more over-policing in communities of color, similar to the war on drugs campaign of the 1980s and 1990s. 

The ban would only apply to companies that manufacture, distribute or sell menthol cigarettes, not individuals who possess or use them. And public health advocates have pointed out tobacco companies also make similar arguments about racial justice. 

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Tobacco companies are also using economic arguments to warn against a menthol ban. 

“A menthol ban would fuel yet another extensive illicit market for unregulated and potentially more dangerous products in the U.S.,” R.J. Reynolds said in a statement.  

“The economic consequences as consumers move to an illicit market will be severe, including adverse impacts on small businesses and on government revenues used to support public health programs.” 

But tobacco control advocates and criminal justice experts said that while there is always a concern about over policing, they are skeptical that a menthol ban would compound the problem.  

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In a speech on the Senate floor Wednesday, Sen. Richard Durbin (D-Ill.) criticized the delays and addressed potential White House concerns that a menthol ban would cause Biden to lose Black voters. 

“I think that’s greatly exaggerated,” Durbin said. “And I want to make it clear, they’re peddling stories — Big Tobacco is — that we’re going to go out and arrest African Americans if they use menthol cigarettes. But that’s not the case at all.” 

​Health Care, Administration, Business, CDC, Cigarettes, fda, menthol ban, Tobacco The Biden administration is delaying a decision on whether to ban menthol flavored cigarettes amid intense lobbying from critics including the tobacco industry, industry-backed groups and some Black criminal justice advocates. The delay is alarming public health groups, which fear that the White House could cave to pressure and delay the rule indefinitely, especially against…  

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Man Sentenced to Prison After Secretly Filming Airbnb Guest in Shower, Threatening Her With Footage on December 6, 2023 at 9:11 pm Entrepreneur: Latest Articles

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The incident took place in 2020 in a Ceres, California home the guest shared with the owner’s son.

​News and Trends The incident took place in 2020 in a Ceres, California home the guest shared with the owner’s son.  

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10 Creative Content Ideas Inspired by Gary Vaynerchuk to Break Through the Noise on December 6, 2023 at 10:00 pm Entrepreneur: Latest Articles

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Vee stresses the importance of building lifetime value by capturing audience attention first before chasing immediate conversions.

​Marketing Vee stresses the importance of building lifetime value by capturing audience attention first before chasing immediate conversions.  

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