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Help with taxes US
 

Hi,
I want to learn something about taxes in US. I'm US resident and have a paypal business account. I know there are two thresholds before paying taxes ($20k and 200 transactions)

Before reach to $20k, will there any tax request from IRS about my money transfers from PayPal to my bank account?
I just moved to USA and I don't want to get into trouble with taxes. I want to do everything properly.

Thank you in advance

Re: Help with taxes US
 

Better speak to a financial professional in your area since, while there are posts about this for you to read and discuss, financial advice is not in the scope of the forum

Re: Help with taxes US
 

No.

Under $20k = hobby.

Re: Help with taxes US
 

Thanks for your answer. I'm not looking for a financial advice actually, I wanna hear some experience from people about that.

Re: Help with taxes US
 

PP will send you the tax form that you'll have to return to them basically.

So don't hit that limit and use multiple accounts

Re: Help with taxes US
 

PAYPAL will issue you a 1099K once you reach $20,000 AND 200 transactions.
Paypment received under goods and services ,not payment under friend and family.
The amount on your 1099k is gross,it does not exclude sales tax and refund,so you have to deduct them to come up with the net.
1099 is sent in January,one comes to you,one goes to IRS.
you can consult a tax accountant .

Re: Help with taxes US
 

You should also research on your state sales tax and income tax reporting

Re: Help with taxes US
 

I know I am late but let’s say I made around $15k... I have to pay taxes on that, right? PayPal won’t report to the IRS but what about my bank?

Can't the IRS see all my statements.. ? Won't they question where I got that money from?

Thank you!

Re: Help with taxes US
 

no, as long as you're not doing anything for them to check it, they won't.

Re: Help with taxes US
 

I'd still pay taxes on it because eventually it'll catch on.

Re: Help with taxes US
 

when you file y our income tax return,you can report your business either as a one liner like misc income or use the schedule for small business.
You can go to IRS SITE and download copies .
as for bank statements,if you are ever audited by IRS or the state,they would ask to see your bank statements going back to prior years,the purpose is to find out if you have undereported your income,any incoming transactions to your bank account ,if not inheritance,tax refund,insurance claims ,SS payments or bank to bank transfer would be considered as income

Re: Help with taxes US
 

Paypal keeps 7 years of our activities ,if a payment is from a sale ,itwould show the item description,sales amount,shipping,sales tax collected ,name and address of the customer,you can download .

Re: Help with taxes US
 

You don't get deducted taxes or anything at PoS but if you're operating off huge figures (50k+) you could get IRS attention

Re: Help with taxes US
 

To be clear, you guys are paying taxes on a 1099 issued in someone else's name on PayPal or eBay MP?

additionally I'm not questioning the validity as I was searching this forum to find if that was possible.

Re: Help with taxes US
 

Old thread. Make a new one please.