Forum

Paypal & the IRS
 

Does anyone know if Paypal shares/gives your earnings info to the IRS if they have your SSN and/or if you have the Paypal ATM debit card??

Because I had a couple thousand dollars or so going through my previous, aged from 2004 Paypal account, that as far as I know, has my SSN on file, and for which I had/have the Paypal ATM debit card - before the whole account was limited until I give them all the supplier docs, business info, etc.

Since I am in the process of getting a merchant account (possibly offshore) and am going to just use throwaway stealth Paypal accounts in combination with Cart-Manager until then, having my 2004 Paypal account limited isn't such a big deal.

But I'm concerned whether Paypal will report any earnings/money that came into that account to the IRS.

To the best of my recollections, it wasn't more than a couple thousand or so at most, a majority of which went to the costs of those items itself and the rest of the extremely small profit (when and if there was any!) which I spent/withdrew/sent out again that instant.

However since its such a small and inconsistent amount, I never reported it as income for taxes.

So my fear is that if Paypal reports it, there'll be a problem!

Does anyone know whether Paypal has started reporting income to the IRS, and if so, what is the income threshold (I'm assuming that they don't report for a few dollars, or a few hundred or so, here and there) at which they start reporting the money to the IRS??

Coming Soon To eBay: The Taxman - Forbes.com

Check that link out, has some info re: Ebay/Paypal and the IRS, got it from a Silver forum, so aint checked it much meself as it relates too U lucky US folks..

No social security # the irs as of today can not follow your paypal. Just don't deposit to your bank account and buy a yacht.... After 4 years of not paying taxes from paypal sales, I finally claim the sales and do alot of deductions on the business. I sale 10 dollar items.
But im sure if you make alot of money here in the usa they might look a little harder . My wifes job money goes in our bank and we live off the paypal debt card with my income. Seems to work for me....
Never give paypal your social.......

too late, I made the mistake of giving paypal my social years ago, before I knew about eBay stealth, when I was still naive enough to believe that eBay/Paypal would unsuspend/unlimit me if I did EVERYTHING they asked and more!

Well the thing is that if they want to tax us, then they would have to ask the merchants to require us to provide our social??

No, I think they wouldn't - NO ID. There are ways around it, and PayPal is not a bank. If they ever obtain the bank status (anything possible), than God help us all!

From what I read somewhere, PayPal would not be reporting anything under 20K going through account in a year, so for those selling more Stealth, accounts really make sense.

Besides, if they do report, they would need to send a statement in January about what they reported, so you would know.
But before this happens, they will have to make timely announcements, so we can start saving documentation on our Ebay transactions for tax purposes. I think this is still few years away.