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Re: How do returns/refund work with 20K annually?
 

I know it's all irrelevant to this post and I really wasn't trying to insult you or start an argument. I read that exact IRS page before making my post this morning and reached the conclusion that since Paypal is a third party payment processor, all payments processed with them over 20k are reported regardless of how the customer pays.

The whole reason we have this $20,000/200 law is because brick-and-mortar stores started fussing about how e-commerce merchants weren't being required to pay taxes on their online profits.

I'm sorry to piss you off man, I really am. I wanted to get to the bottom of this so I would know in the future.

Paypal is classified as a third party network.

Re: How do returns/refund work with 20K annually?
 

I am only pissed off at DHL, Fedex and USPS lol How can all be so darn late?! lol

Re: How do returns/refund work with 20K annually?
 

Hah. Phew!

Probably a combination of terrible weather + Christmas. We'll see if our shipments make it through Cinci today..

Re: How do returns/refund work with 20K annually?
 

Has anyone been contacted about a 1099K by the IRS?
I was for a 2011 1099k by the state of Massachusetts back in 2015. They explained it was because I registered a new business. They ONLY cared about 2011, not any other years. Quite odd.

Re: How do returns/refund work with 20K annually?
 

Luckily I have not - but I've only been doing this for 4 years and some change. I would probably sh!t my pants.

Re: How do returns/refund work with 20K annually?
 

I was just thinking about something.

You said your bank withdrawal amount is always 10-15% less than your PP statement/1099k. Do you think that could be due to paying eBay/Paypal fees and refunding certain customers before doing your withdrawals? Seems logical to me since aggregates are reported on 1099 and not what you netted.

Re: How do returns/refund work with 20K annually?
 

Possibly.....But I also inquired back in early 2014 with paypal. That year my gross withdrawals were about 1.2 million and my 1099k was 900Kish it was because I had several non qualifying transactions. almost 14,000 transactions.

My CPA at the time said he had a client who got an audit and was short paid because she only claimed her 1099k back in 2011. I seem to not believe him only because the 1099K are not compared to filings for at least 3 years if ever....but who knows.