Red Tape Reduction Act Introduced

Payment card and third-party network transactions (e.g., credit card companies; PayPal, etc.) are required to report to sellers on Form 1099-K the total amount of transactions if they exceed a set amount. A bi-partisan measure—Red Tape Reduction Act—to raise the threshold for Form 1099-K reporting from the current $600 to $10,000 has been introduced in Congress. Before 2022, the threshold had been 200 transactions totaling more than $20,000. The threshold dropped to $600, regardless of the number of transactions, but at the last minute the IRS postponed implementation of the $600 threshold. The proposed $10,000 threshold has the support of the IRS because it would reduce its administrative burden. #IdeaoftheDay

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