When in 2011 will paypal require us to give out SSN#?

[eagleflyfree]

Will it be the first day of 2011? Mid 2011? End of 2011?

[slapped]

How about 4th Quater 2010

[eagleflyfree]

Originally Posted by slapped

How about 4th Quater 2010

Ah, that would suck big time.

[gibsonton]

By Jan , 1 2011 ... so 2010 tax year is important .. if you are claiming 10k this year and than paypal reports 150k in 2011 .. not good

[OfficialGenius]

jeffweico

It all depends on how PayPal implements this.

They MUST comply with the new regulations, they have no choice. So, they have to decide how to implement this at the lowest cost to PayPal.

The new rule states that only sellers with more than $20,000 and 200 transactions have to be reported.

So the issues for PayPal are:

1) Do they get everyone's SSN upfront, or do they only require sellers who meet the new criteria to divulge their SSN's? Which costs less?

2) In considering #1, how many users who will not meet the threshhold anyway will not want to do business with PayPal if they have to divulge their SSN? There are MANY LEGITIMATE reasons for not wanting to do so.

3) If they require the SSN's upfront, does it have any other benefit to PayPal? Maybe in fraud loss reduction?

So, the powers that be at PayPal will meet to discuss these issues. Each person will probably have their departments estimate the cost and effect of each scenario, so they will have numbers to discuss.

At the end of the day, they will do whatever costs them less, be it in employee salaries (someone would have to manage the process of getting the SSN's from individual sellers), lost business (it they just make it a requirement of all users upon signup), and then also taking any positive benefits into consideration.

That is how businesses operate. Everything is a financial decision.

I don't know the internal working of PayPal, so this is just a guess - they will only require sellers meeting the threshhold to divulge their SSN's. Why? Because they are probably a small number of accounts.

I also think that many, if not most, sellers already report their income, so I doubt the IRS will get as much of a lift out of this as they are hoping to.

Just my opinion...

[romeo216]

I can't see paypal asking for a ssn upfront. There will be many people who open an account just to buy things. It's going to be frightening for me if they require a ssn upfront.

[pod]

Originally Posted by romeo216

It's going to be frightening for me if they require a ssn upfront.

Membership will crash dramatically. And I mean across the board not just folks with bogus info.

It will change the face of ebay almost overnight in my opinion. That is if they ask everyone, old and new, for SSN

eBay offers some good deals for buyers. But if they are even remotely uncomfortable with giving out SSN they will just shop somewhere else. I cant see ebay asking buyers to supply it to be honest. It would be so much work and cost them so much money to implement. Without knowing much about it I suspect it will be rolled out slowly and start with high volume sellers 1st. Buyers will remain unmolested. And I would even think casual sellers too.

But tons of sellers are going to vanish very quickly. Not sure if that's good for anyone.

[slapped]

Thet will most likely require a SSN for Premier accounts, Regular Paypal accounts would effectivly be "Buyers" Accounts and Premier Accounts would be "Sellers" Accounts, and in order to Verify them you Must give a SSN.

UnVerified Premier Accounts Have a $500.00 per month or $6000.00 per year Limit on them to begin with well within the Law and enough to satisfy the "Casual Seller, so in order to Verify them they will simply "Delete" the Credit Card Choice, and Force you to give them your SSN.

If at some point durring a Calander year you are Selling and "Cross" the $6000.00 mark they will Limit your Account and Force you to Verify if you refuse you will Wait 180 days, but you will wind up getting limited LONG Before you cross $20,000 for the year, they left themselves a $14,000 Cushion ($20,000-$6,000=$14,000)

So to me, there is no big mystery as to how they will implement this.

In other words it is ALREADY Set up


Anyone who has logged into Paypal Recently may have Noticed the "Pardon our Dust" banner which means they are making "Changes" to the Site it is a Pretty good bet that these are the changes that they are Implementing, Right Now as we Blog.

[Burning]

First of there are alternatives available in order to avoid paypal's ssn requirements. I've known people who have created offshore paypal accounts such as in Thailand, and other third world countries. The only problem with creating an account in another country is getting a bank account. I'm not sure if they allow paypal's in another country to add a USA bank account or not. It sound like a hell of an idea but it can take alot of tedious work in order to create one!

[xl_The_Jackal_lx]

Originally Posted by Burning

First of there are alternatives available in order to avoid paypal's ssn requirements. I've known people who have created offshore paypal accounts such as in Thailand, and other third world countries. The only problem with creating an account in another country is getting a bank account. I'm not sure if they allow paypal's in another country to add a USA bank account or not. It sound like a hell of an idea but it can take alot of tedious work in order to create one!

Only US, UK, CA, and AU paypals require a bank account for verification last I checked.

I think we are witnessing the slow demise of Paypal. The next year is gonna be interesting.

[eagleflyfree]

Originally Posted by gibsonton

By Jan , 1 2011 ... so 2010 tax year is important .. if you are claiming 10k this year and than paypal reports 150k in 2011 .. not good

I did some googling, and it seems that 2010 tax year is NOT important.

https://www.thepaypalblog.com/2008/0...ts-become-law/

"This legislation applies to all payment providers including PayPal and takes effect in 2011, so the first reports will go to the IRS in January 2012. "

[pod]

Originally Posted by eagleflyfree

applies to all payment providers including PayPal

Putin the squeeze on all the payment processors. Cracking down on online business. I bet there is a huge amount of coin that goes undeclared.

[ptenchick]

So, let's bring more business to Paymate, Googlecheckout and other alternative payment prosessors! Let's make them prosperous!!

[slapped]

Originally Posted by ptenchick

So, let's bring more business to Paymate, Googlecheckout and other alternative payment prosessors! Let's make them prosperous!!

All US Based payment Processors including Google are required by the Goverment to Report Not Just Paypal

[romeo216]

When paypal implements this, ebay should allow sellers to accept money orders again. I don't believe a new seller can accept money orders right away. I think that's something that has to change in order for ebay to stay in business.

[pod]

It has nothing to do with the form of payment. Its the payment itself they want to track. Even pick up for cash will be on record

[aspkin]

I bet you guys anything that exactly how PayPal operates today is how they'll operate in 2011..

Let's see what happens.

[jeffweico]

Originally Posted by pod

It has nothing to do with the form of payment. Its the payment itself they want to track. Even pick up for cash will be on record

OK, but how do you track CASH?

I don't think that eBay will have to report anything since they don't take payments directly. But even if someone had your eBay records, and it said the buyer was going to pick up the item for cash, how could they prove the transaction ever took place?

In any event, I think that people should pay taxes on their profits, if only for their own safety (remember, they couldn't get Al Capone - until they charged him with tax evasion).

[pod]

Originally Posted by jeffweico

OK, but how do you track CASH?

how could they prove the transaction ever took place?

.

Not sure what they are up to in the US, but here the sale, if marked paid, is all they need. In fact they can "estimate" an income and charge taxes and penalties on that estimate. .... That one I know all too well

You could always prove transaction was never completed, but in the grand scheme I have to think cash sales on ebay are pretty rare anyway. I have to imagine they are looking for sellers with 100K in unreported sales or what ever. Big fish 1st would be my guess.

[Burning]

The best alternatives seems to be AlertPay due to the fast that they are based in Canada. It's similar to paypal...

[pod]

Stay far far away from AlertPay. They are locking up accounts and reversing payments and crap way worse than PayPal ever did. PayPal gives you a reason. Alertpay just moves money in and out of your account at will. If you have a transaction, from a guy who has a transaction with a guy that is doing something they don't like they lock em all up. All 3

[Burning]

Originally Posted by pod

Stay far far away from AlertPay. They are locking up accounts and reversing payments and crap way worse than PayPal ever did. PayPal gives you a reason. Alertpay just moves money in and out of your account at will. If you have a transaction, from a guy who has a transaction with a guy that is doing something they don't like they lock em all up. All 3

They have an EXCELLENT BBB reputation:

BBB Review of AlertPay.com in Montreal, QC

I never had a problem with alertpay but maybe because I did not receive any money..

I only paid a couple of people via alertpay...no problem there..