Tax ID request at LOW AMOUNT OF SALES

[boost]

Originally Posted by Sandy D

Thanks.

This just proves my post is correct and people need to be aware that large volumes of sales on one account is no longer the best thing to have.

Spread things over many accounts is the way to go.

I do it and do it successfully so others can to.

I have long exceeded the 20k mark, but not the 200 transactions. You must have both in order to have PP send the info to the IRS. Now, with that said, I believe that it is NOT 200 ITEMS sold on ebay per se, BUT 200 TRANSACTIONS coming though paypal. You have one buyer who bought 10 items and paid in one paypal payment, it counts as 1 transaction, not 10. So if you have 200 transactions to deal with on paypal, you now have 199 and not 190.

This has its advantages.

[Sandy D]

This is not correct.

Many have reported even less then my numbers.

You DO NOT have to reach both thresholds at all.

Did you even read Roscoes? He got it with a very small amount of sales.

It is the potential of you hitting those numbers and NOT you actually hitting them both.

Your info is totally wrong as I have experienced it without hitting either number or even close to it.

I was told by a tax expert this is what they were told and it has turned out to be just another lie by pp.

And my transactions never hit the 200 on this pp account and of course never come close to the 20k.

With the ever changing ways we all need to be careful as it has been proven that 200/20k is NOT a true statement to the meeting both of those numbers.

[boost]

No - they can request the tax info at any time. Doesn't have to be 20k/200. It is the IRS REPORTING that isn't done until meeting both criteria.

I sold $30k last year but less than 200 items. I check in my paypal account under the tax section and have NO 1099 available.

It's not reported until you reach BOTH thresholds.

YES, they can ask for tax info anytime they want...that doesn't mean they are going to report it.

[Roscoe]

I stand corrected. I previously thought it was $20,000 or 200 sales.

This is what PP says: https://cms.paypal.com/us/cgi-bin/ma...ng_us/IRS6050W

Internal Revenue Code (IRC# Section 6050W states that all US payment processors, including PayPal, are required by the Internal Revenue Service #IRS# to provide information to the IRS about certain customers who receive payments for the sale of goods or services through PayPal.

PayPal is required to report gross payments received for sellers who receive over $20,000 in gross payment volume AND over 200 separate payments in a calendar year.

PayPal will track the payment volume of your account#s# to check whether your payment volume exceeds both of these levels in a calendar year:
$20,000 USD in gross payment volume from sales of goods or services in a single year
200 payments for goods or services in the same year

You may be asked to add your tax ID number, such as a Social Security Number #SSN# or Employer Identification Number #EIN#, to your existing account#s#, if you don’t already have one on file.

If you cross the IRS thresholds in 2012, PayPal will send Form 1099-K to you and the IRS for the 2012 tax year in early 2013.

Will I be affected by the 2011 tax changes if I only meet one of the thresholds?

No. A seller has to exceed both IRS thresholds #$20,000 in gross payment volume and 200 separate payments) in a calendar year before a Form 1099-K is required.

We may require that you provide a tax identification number before you reach these thresholds however we will only report your payments if you exceed both thresholds.

[Sandy D]

Originally Posted by boost

No - they can request the tax info at any time. Doesn't have to be 20k/200. It is the IRS REPORTING that isn't done until meeting both criteria. I sold $30k last year but less than 200 items. I check in my paypal account under the tax section and have NO 1099 available. It's not reported until you reach BOTH thresholds. YES, they can ask for tax info anytime they want...that doesn't mean they are going to report it.

I never said it was going to be reported.

The thread is NOT about that issue.

The thread is to let people know they will ask for and in most cases shut your account time over time if you do not provide them the information.

You stated above you had to reach both thresholds before you will get the request and it is not so.

If you read thought many threads you will find many people getting their pps shut down because they were asked for SSN or EIN and did not provide it.

That is what this thread is all about.

Letting people know that if you get close or have the potential to hit these numbers be prepared to provide this info or the account will be limited at some point if you do not provide.

[Sandy D]

Originally Posted by Roscoe

I stand corrected. I previously thought it was $20,000 or 200 sales.

This is what PP says: https://cms.paypal.com/us/cgi-bin/ma...ng_us/IRS6050W

Internal Revenue Code (IRC# Section 6050W states that all US payment processors, including PayPal, are required by the Internal Revenue Service #IRS# to provide information to the IRS about certain customers who receive payments for the sale of goods or services through PayPal.

PayPal is required to report gross payments received for sellers who receive over $20,000 in gross payment volume AND over 200 separate payments in a calendar year.

PayPal will track the payment volume of your account#s# to check whether your payment volume exceeds both of these levels in a calendar year:
$20,000 USD in gross payment volume from sales of goods or services in a single year
200 payments for goods or services in the same year

You may be asked to add your tax ID number, such as a Social Security Number #SSN# or Employer Identification Number #EIN#, to your existing account#s#, if you don’t already have one on file.

If you cross the IRS thresholds in 2012, PayPal will send Form 1099-K to you and the IRS for the 2012 tax year in early 2013.

Will I be affected by the 2011 tax changes if I only meet one of the thresholds?

No. A seller has to exceed both IRS thresholds #$20,000 in gross payment volume and 200 separate payments) in a calendar year before a Form 1099-K is required.

We may require that you provide a tax identification number before you reach these thresholds however we will only report your payments if you exceed both thresholds.

Correct, but the thread is about being asked for the information at number way below the 2 thresholds.

It is not about getting the 1099 at all.

That is an entirely different subject in itself.

[Roscoe]

So PP is saying I could run 1 Million thru my account and less than 199 sales and they WON'T report it to the ABC agency?

Hmmmmmmmmmmmmmm!

Luxembourg here we come.

[Sandy D]

Nope.

The account will get the request and have it cleaned out as it will get the request because you have the potential of hitting both thresholds.

Once it is requested many have reported they lasted a month or two and then the account was limited.

If you run anything close to those numbers you will get the request long before because pp sees you as having the potential of hitting it and will jump all over it. Unless they do the normal pp thing and miss one here and there.

[Roscoe]

Yeah, what the Heck is with PP. I had the request twice via legal PPs. After I submitted docs I continued to sell but eventually PP shut down my account.

I had a Legal LLC for years, everything was perfect, then kaboom!

Every single person I know has been shut down after the dreaded Soc Sec request.

Does PP only want Stealth Accounts? What the

[Sandy D]

I hope so as I have a nice stack of them to last me for years!!

[boost]

Originally Posted by Sandy D

I never said it was going to be reported.

The thread is NOT about that issue.

The thread is to let people know they will ask for and in most cases shut your account time over time if you do not provide them the information.

You stated above you had to reach both thresholds before you will get the request and it is not so.

If you read thought many threads you will find many people getting their pps shut down because they were asked for SSN or EIN and did not provide it.

That is what this thread is all about.

Letting people know that if you get close or have the potential to hit these numbers be prepared to provide this info or the account will be limited at some point if you do not provide.

No I never mentioned anything about the tax REQUEST even in my OP. I only stated IRS reporting. I already knew they could request info at any time.

[boost]

Originally Posted by Roscoe

Yeah, what the Heck is with PP. I had the request twice via legal PPs. After I submitted docs I continued to sell but eventually PP shut down my account.

I had a Legal LLC for years, everything was perfect, then kaboom!

Every single person I know has been shut down after the dreaded Soc Sec request.

Does PP only want Stealth Accounts? What the

I was asked for EIN, I provided it. Got limited later on for another issue and they wanted SSN...provided it and have been fine ever since, putting a good number of sales through with no issue. I dont plan for it to continue forever though.

[Roscoe]

Obviously that is not a Stealth account!

[boost]

The way you were talking, it sounded like you still got the hammer after submitting SSN.

[Roscoe]

That's correct. That's when I had a real PP account. Now I'm all Stealth.

[boost]

Right - so what I said was a valid remark.

[vogeltron]

Yea, the request will be there pretty much after a few thousand in sales. In 2012 for the first time on a stealth I had an account in Mid December just below 19k limited for receiving payments. It was reset about the 20th of January. I would say don't worry about it and try to spread your payments out.

So GreenBean does not get on me make sure you if sell items you realizes the taxes you have to pay and talk to an accountant. But if you are trying to get around the 20k for stealth usually the provide your tax id for PayPal the past 2 years has not meant anything. Until they actually limit you for getting payments. The best way to do that is to spread them out over the year as evenly as possible.

And as GreenBean would say make sure you talk to your accountant and pay your taxes.

[455]

I thought paypal asked for the ssn once they asked for the ID + billing scans at about the $1,000 mark that all accounts get hit with? To my experience they ask for supplier invoices and receipts at around the $8,000 mark and your ssn is given to them long before that. Did they change this or something?

[Mr. Invisible]

Ran into this mess late last year

I try to keep my weekly sales average <$400 & <17 transactions per account now. If my averages get past those levels I pause on that account until my weekly averages are back below those levels.

[vogeltron]

Originally Posted by 455

I thought paypal asked for the ssn once they asked for the ID + billing scans at about the $1,000 mark that all accounts get hit with? To my experience they ask for supplier invoices and receipts at around the $8,000 mark and your ssn is given to them long before that. Did they change this or something?

You must be selling some high risk stuff. If you keep good standing with eBay and PayPal it takes time to work up to that amount of sales. Normally on a new ebay/paypal thanks to the selling limits on eBay I am lucky if I get 10k in the first year because it takes 3-4 before you can really even sell anything. If you are moving money through ebay/paypal that fast on new accounts you will get limited and asked for invoices suppliers etc. Unfortunately nowadays the tortoise seller on eBay is the one who stays in the game with stealth accounts.

[yukinara]

This is my exact problem last year. I sold TOO FAST during the holiday season (can't help, it's Christmas and everyone want a gift), as a result, thousand of dollars pour into my PP account. Finally PP limit my acc and ask for supplier's invoice. In the end, they permanently limit it for good. If they didn't, I probably pass that $20,000 mark, because I made like $3000- $4000 a month.
In the new account, this month alone, I sold $600 worth of goods, I guess that's why they ask for my SSN, gotta do it slower.

[vogeltron]

eBay and Paypal your reputation. Think of it like a credit score, you have to build good standing with them and play within the rules.
It sucks as I know but to survive now that's how it is. I do have stealth accounts where I have sold 3k in month never more.

But I have had them since 2008. I had one account last year in December I got limited fro receiving money at 19.2k but it was reinstated in late Jan this year. It is all about taking it slow and trying to build a reputation with them.

It can be a hassle but there really isn't any way around it anymore. I might suggest if you are running into these problems maybe if you haven't already purchasing the stealth guide and consider running multiple stealth accounts so you can spread out your sales.