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Under 20k, Paypal wants Tax ID #
 

Alright, I need help! Paypal has sent me 2 emails and currently this is posted at the top of my Paypal page:

Please provide us with your tax ID number. Your tax ID number lets us send you Form 1099-K, as required by the IRS under certain conditions. Find more information about the new tax rules and why we need your tax ID at www.pay$al.com/irs.

The first email said pretty much the same thing as above. The second email was more forceful, saying that without this information the account may be limited. No timeframe was given and the language was vague enough that Paypal could have been saying "If you go over the 20k limit, we will limit your account". But I really don't know. They haven't given me any clear sense of when I have to provide this information, and I'm hesitant to call them to get more information about it.

Currently the account still works, and its been like this for around a month now. However, my concern is growing that its only a matter of time before this account gets frozen. I'm sure I'm way under 20k for the year (estimated at around 6k) and won't be going over 20k. This isn't a question of taxes, its a question of keeping my account from getting frozen. Does anyone have any experience with this or is there a thread that already describes this exact situation? Will Paypal freeze this account if I don't give them my Tax info? Help!

Well the issue just wont go away, or resolve itself without you providing a SS#, or EIN.

You are in paypals crosshairs so you better be prepaired to get limited, or shut down your operation. At this point, you have no choice. Sorry.:shocked:

Don't go over...have a few in similar positions read what PayPal has said. You aren't required unless you pass those marks...this is just early notification

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http://www.aspkin.com/forums/paypal-...d-s-s-irs.html

http://www.aspkin.com/forums/paypal-...it-paypal.html

http://www.aspkin.com/forums/paypal-...et-1099-k.html

http://www.aspkin.com/forums/paypal-...-usa-only.html

My contribution to your quandry. YOU have had ample time to be prepared. Last thread was started in 2010.....:pop2:

re:
 

THanks for the information. GreenBean, what would you recommend doing in this situation? The forums show contradictory information about the ease of using an EIN number... and I'm getting told that I shouldn't worry about it as long as I'm under the 20,000 limit. Out of my 3 accounts,
2 are now being asked for a Tax-ID Number. Do you have any ideas? Should I worry or should I wait until this is a problem?

The only 'problem' is your worrying about it.

Not a bad thing but it makes matters worse.

EINs are not difficult to obtain. And, from the reports on this forum alone, have been of benefit to users. :peace:

What method(s) would you recommend for obtaining multiple EINs? I'm seeing online applications directly through the IRS but don't know how to go about filling out the form given the stealthy nature of my paypal accounts. Similar concerns pop up in the face of talking to an accountant.. what information can I give? What should I avoid? This doesn't appear to be a fool-proof process, and I have limited room for error. Especially when it takes at least 3 months to get a fully functional ebay//paypal ghost account.

ps: all 3 of my accounts are power sellers over 10 months old and currently are my only source of income. I'm on here hoping to learn some details about how someone else has solved this EIN problem, and a general approach to going about it with some "do this" and "avoid that". Until I have a general idea of how to go about this, I'm comfortable expressing my concern for my job as "worry". I don't want to learn how to get multiple EINs at the expense of my current accounts.

Then do one of two things. Get an EIN and use it on one account to test it. ( Most have had success here ). Or you can do it with another new or newer account and test.

The process is very easy, using it is easy, keeping records and understanding once you do you are a full blown business is where you need help.

Once you use it on your account then you are liable for everything that goes through it. Every dollar. You need to also set up estimated quarterly tax payments. if you didnt do it already you will be hammered at tax time for the full brunt of your tax liability. This should have been though about in January an not just now. the year is nearly over and you have made no tax payments thusfar. One main reason that you are not ready for the EIN to be used on a business at this time.

I would not use one until next year if I were you. that way you can start from Jan instead of nearly the end of the year. . Not worth putting on here since people that know nothing about EIN and SSN want to post speculative information.

this is so stupid.

I have a limited $500/mo account, and they still want my tax id. I see that big yellow banner at the top of my pp account.

It is impossible for me to go over $6000 per year. Why the fark would I want to provide my tax id when I can't possibly go over 20k.

odd yes but it really doesnt matter as you are playing by someone elses rules. Gotta post it or lose the account.

i wonder what they're gonna do if i don't give a tax id#.

seeing as i'm already limited to $500 a month, how much more can they limit me..........

Since it's their rules, the chop will limit you.

Can you not supply Tax EIN? Doesnt matter the amount, what matters is you are selling, getting funds, & therefore tax is payable. Dont forget that little angle. IRS still want to know. :)

Even with an ein in file PayPal wont report it unless you go over the limits.. if they do then they are lying

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After receiving two emails from Paypal demanding Tax ID, I finally posted my LLC's EIN. And as soon as I clicked on EIN, Paypal "forced" me to upgrade my account to a business account. I had no choice but following through the process. Did I do something wrong now? I am very concerned as the Paypal account is a stealth account, the account information does not match my LLC's info. Shall I anticipate an account limitation coming my way? Any info is helpful. Thanks in advance.

People need to listen to KingRay, he is dead on correct in this area of doing the CORRECT thing when it comes to EIN, SS, business records etc.

LISTEN UP PEOPLE.

Did your business name match the LLC and EIN exactly? also did your business start date coincide with the start date you listed when upgrading to a Business account?

If all those things didnt match then you might want to get a back up account.

I have wasted probably 20 accounts testing the limits of the LLC's and EIN's to see what can and cannot be done. when those dont match, I have been suspended nearly 80% of the time within a month. When suspended they wanted a SSN on some and indefinite suspension on others. So far nothing but random"ness" from paypal on this issue.

If those didnt match then get a back up ready so if it does get lost then you atleast have some income coming. If they dont suspend it then good you will have 2 up and running accounts.

As far as what someone said about reporting under 20k. They will PROBABLY NOT but are only required to on 20k. Nothing says that under simply will NOT be included. I dont think they will as they would say something about it. BUT as said in a prior post. I can almost assure you that the 20k thing is a 1 yr or 2 only deal. You can almost bet that it will drop dramatically soon as I feel the 20k limit is a test to see what kind of tax can be generated from that level.

I also think that they know people will still avoid it and that will make the drop it or make any income at all reportable in the future. They will make you report it no matter what and its up to you to prove that its a hobby or casual selling.

That last few statements are speculation as I clearly stated as but some on here take things too literally as fact sometimes. I go by what I read and see on various business networks and post my opinions based on those facts. Just an FYI for you all really....

so, just business name and start date match ein ?

address can be whatever ?

paypal limits
 

i have paypal on one name and want to give SS# with other name, would it work?

Correct but also Address posted to the IRS should be the same as the Paypal account has down. The IRS doesnt care about address as much as paypal but you should keep it at an address you can access. The IRS will send you paperwork now and in april.


As said before, the EIN process isnt perfect for stealth by any means.

The names doesnt matter because they will make you upgrade to a business account. when you do that then the business name is what matters. The Business name must match the IRS to the letter. The name you give the IRS has to match your ssn.

So how do you have 10 paypals? 10 ein? Woukdnt that mke thebirs flag you and your ssn when you have differe nt addresses. Can you explain howba ein is created?

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You cant, That is why I said using the EIN method is not really much of a stealth option. just a sort of redoing your real account.

for instance. you burned your real SSN with papal years ago. If and only IF you want to make it a business and treat it as one then you can get an EIN using your SSN and go that route. Paypal will see the business name only(so far) and will make you upgrade to a business account. Then you sort of have a fresh Identity with ebay even though its your real info.

Dont simply do it and think things are going to be smooth though. Dont even bother unless you contact a professional about a business plan first.

Buying low and selling high isnt a business plan. Plus you need to get your estimated tax payments started so you dont have a huge liability in april.

There is much more as well including business depreciation calculations, etc. Not just a hobby once you go with an EIN.

FFS, How many times do you need to be told that this is NOT a good idea given the SSN number you have previously said you want to use?

No parent should consider doing that to their child.

It really really seriously matters when it is the SSN of your 4 year old child.

I suggest you qualify advice for next time given you get upset when posts get deleted.:doh:

Just remember you are certainly most knowledgable in this field BUT you are not a tax professional.

I think this post was misunderstood. The person said other name so I assumed they meant "stealth name" If you are talking about another person (ie relative) then dont ever do that. it will get you into more trouble than you want to deal with.

KingRay it seems that you know a bunch about this, question just to kinda 100% make it clear:

So I Open a EIN with IRS Name the Company "Number 1" This company is on my real name.
I supply this EIN with the Company name "Number 1" to paypal. In this case it will not work? Or will it?
Will paypal check and see that this company name and EIN is connected to a different owner name, then the name registered with them(paypal)?

Appreciate the answer if you have

Payapl want the number, the EIN number at this point. Supplying an EIN is the current layer of protection & makes paypal happy.

Company 1 would be created to allow paypal to see what it wants to see., a name & number;)

Dont forget that this is to be done with the advice of a tax professional to cover all bases.

Thank You GreenBean.

But this brings another question. If you in normal conditions supply paypal with a not real SSN they are able to know that it is not real meaning your name on their file does not match SSN provided.

So do you still think they cannot check the EIN provided in the example and see that the name of the person who opened the company is different then the name provided in their file?

Thanks for your answers, great input here

How can i get an EIN?

Do I have to open a business?

Hi
I received this message on my Stealth PP account this morning.
I don't know what to do?
I'm close to the $20000 around $17000 and PP sent me this.
Please provide us with your tax ID number. Your tax ID number lets us send you Form 1099-K, as required by the IRS under certain conditions. Find more information about the new tax rules and why we need your tax ID at www.paypal.com/irs.

Can I open a business on to my name(legal), upgrade my Stealth paypal to a business Account, provide the new legal business EIN to them and still selling on my stealth eBay account without any pay pal or eBay restrictions?

This are two eBay power sellers accounts that I don't want to loose.

Please help

Thank you

I wonder if it's going to be possible to open another paypal and link it to the ebay account if the paypal account goes down because you can't supply a ssn... i just hope they stick to their word.. that it won't matter unless you pass the thresholds, if it does they lied to us all along they aren't supposed to limit accounts who don't violate the 20k/200 and if they do... WE are in huge trouble. If we can't use the ebay accounts with other new paypals.. Make sure your paypal's aren't linked ><

That question is the basis of all these forum threads about EIN's. do a search and you will find your answer in detail. Many many times over.

This also have been discussed to death recently. Paypal compared your name to your SSN when you use SSN. Now when you upgrade to a business account they compare the EIN to the business name now.

SO FAR this has worked fine, Although I would think they would soon be asking for your SSN as well to make sure you are who you say you are. some have been asked for both. Not sure at all why some do and some dont yet but I am testing several accounts now to see what gets SSN or more info requests and what doesnt. using different items for sale as well in case that is the trigger.

As also mentioned in many of my posts, the use of the EIN is NOT a perfect stealthy way to go. Its a way to start fresh with a legit business. with that said, you should really contact a professional tax adviser or attorney to get a REAL business plan in place and estimated tax payments set up before you even bother.

Thank You Kingray.

That was the first CLEAR answer on that question.

Ok I dont know if someone has asked this before as I have tried to find it. But my question has nothing with trying to avoid paying taxes it has to do with it being a stealth account, pp is already ask for ss or ein or tin. I can not provide ss cause "stealth" do not want to do the ein thing cause I dont want to make any irs or additional problems. Not ready to take it from hobby to hardcore lol.
My question is (finally), what if I was to close the pp account? leave the eby acct that is connected to it alone say for a month or so. Then reregister a pp account either with the same exact info and bank account, or same info and new bank account (either one)?
Then reconnect it to eby account and start selling again. Would this work?

You know this is in the book right?

You telling me or the other person???

You are advising against something that is in the book.