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Will my paypal account become frozen for not supplying tax info?
 

Hey everyone, I just received a second email from paypal stating the following:


We still have not received your Tax ID number. Please provide your Tax ID
number to comply with Internal Revenue Service (IRS) rules. Your Tax ID
number is one of these:

- Your Social Security Number (SSN)
- Your Individual Tax Identification Number (ITIN)
- Your Employer Identification Number (EIN)

We are required to obtain Tax ID numbers from all online sellers who
receive payments for goods or services through PayPal. If you do not
provide us with your Tax ID number, your account access will be limited,
and you will be unable to request or receive money.

After you provide your Tax ID number, your account will be fully
functional. Here's how to submit your Tax ID number:

1. Log in to your PayPal account.

2. A message will appear asking you to update your information.

3. Click Provide Now and follow the instructions.




I am currently at about 195 sales and 11k for this calendar year on this account. I am aware of the 200 and 20k limit that hits and is required to provide tax information.

My question however is can paypal limit or freeze my account for not providing them with this information without hitting the 200 / 20k limit? Now that I know what will set it off, I can intentionally avoid going above 20k during this calendar year. I just do not want to sign into my account one day to make a transfer and not be able to when my balance is in the multi-thousands.

Since I am also a 'new seller', I am dealing with the "may take 21 days or less to get your funds so provide tracking to GET IT SOONER!!!," Thus I cannot just empty my balance on a whim as I would like to. I have a few thousand pending balance and a few hundred available. I am scarred this large pending balance will get frozen. How long until paypal is dissatisfied with my unresponsiveness and limits me? Or will this only happen if I cross over into 200/20k territory?

Re: Will my paypal account become frozen for not supplying tax info?
 

Difficult to estimate "how long" but yes, PP can limit accounts well in advance of the 20k/200 threshold based on PROJECTED INCOME rate.

Re: Will my paypal account become frozen for not supplying tax info?
 

Okay so what can I do besides shut down my listings? I have pending funds that I won't be able to transfer for another week or two. If I am frozen before then, I will be out a couple thousand dollars. This is a real issue.

Re: Will my paypal account become frozen for not supplying tax info?
 

The only thing I am worried about at all is my pending current balance that I cannot move to a safe place.

Re: Will my paypal account become frozen for not supplying tax info?
 

Slow down the rate and transition sales to OTHER stealth accounts - rotate

Re: Will my paypal account become frozen for not supplying tax info?
 

Yes that helps for the long run. I guess I can always just use the self refund trick if I get smoked. Really wish someone would interject about my current issue / which rout to go, such giving a bad tax ID number, or just ignoring all together... ?

Re: Will my paypal account become frozen for not supplying tax info?
 

Sadly yes eventually the account will be restricted , Hope you have other accounts

Re: Will my paypal account become frozen for not supplying tax info?
 

Yes, normally around 25-30 days they will shut it down.

Get your funds out slowly and smartly now.

Might as well stop selling on that account also.

I always stop at 175 or so on accounts and let them sit until the next year.

The 200 and 20k is just a threshold placed on paypal by the IRS.

Many have reported a lot lower numbers and got this.

It is basically going by the POTENTIAL of you hitting those numbers.

Re: Will my paypal account become frozen for not supplying tax info?
 

Bro,

Why don't get just get an EIN. You can get an EIN for the name of the paypal you are using for $100 at legalzoom. It's what I do.

Just like all my other posts, this is just what I do. Other people like to spread sales but that's just such a hassle.

Re: Will my paypal account become frozen for not supplying tax info?
 

If you don't plan on creating an LLC and get an EIN than definitely stop selling on the account

The more sales you build after receiving the notice the faster they will shut you down

They are protecting themselves and need to abide by IRS regulations so they will close u down long before you reach both 200/20000

Cut off sales and transfer funds out

Re: Will my paypal account become frozen for not supplying tax info?
 

This is something I am interested in. Does this work 100% of the time? And it will allow me to continue selling / using the account?

Re: Will my paypal account become frozen for not supplying tax info?
 

Yes. It's actually cheaper but I always pay the overnight method for more.

You just provide paypal the EIN information. Make sure you upgrade your PP account to business beforehand. No extra fees but it changes the standing of your account. It also changes your view to a more book keeping feel.

Re: Will my paypal account become frozen for not supplying tax info?
 

Well they just pulled the plug and said my account Is now limited. This is one day after they requested the information. I have over 1500 in the account that I think I just lost. 150 of that 1500 however, was in my avalible balance and I was able to send this out to a different paypal even after they told me I was limited. Anyone know why this would happen? Has it not kicked in yet or is it just a limit for receiving payments and not sending them because if that's the case I don't even care about this.

Re: Will my paypal account become frozen for not supplying tax info?
 

Try and withdrawal or send money see what happens

Re: Will my paypal account become frozen for not supplying tax info?
 

I did, I was able to send my full available balance 150/1500$ out. That worked. The rest is unfortunately pending because I am a new ebay seller. I am hoping it will be released to me in time for me to transfer it out. However, I cannot accept payments. I tried sending one to myself- no go.

Re: Will my paypal account become frozen for not supplying tax info?
 

Be aware that the transfer might get reversed.

Take a moment now to decide what you are going to do with any other accounts to conform with the paypal/IRS requirements.

You need to deal with this as soon as you can.

Good Luck
:mod:

Re: Will my paypal account become frozen for not supplying tax info?
 

I'm not sure but you may be able to still lift the limitation by providing an EIN.

From what you described it looks like that the account doesn't have a full limitation on it or you would not be able to move money as you have

It looks like they just limited you from making anymore sales. They need to be very strict and on top of the limits , it is an IRS regulation so far before you reach them limits they will ask for the tax ID AND than limit the account because if you go over and no tax ID than Paypal is In trouble

But do some research speak with your accountant , this is an easy fix, just get the info by a professional, and hopefully if you get on top of this right away u may be able to salvage the account if not than u will know what you need for future accounts

Re: Will my paypal account become frozen for not supplying tax info?
 

is it 200 transactions and 20,000 ? or say could i do 500 transactions at $10.00 a transaction and be ok?

Re: Will my paypal account become frozen for not supplying tax info?
 

Okay - I have a dirth of knowledge about this situation so here's a brain dump.

The limit has been 200 AND 20,000 for 3 years now, and PP used to limit people's accts for the IRS at approximately $17,000 in sales, but now they've changed it to limiting people at around 175 sales for the year, which stinks for sellers of small gidgets and whatnots like myself (my average sale is about $6).

Your PP will be quasi-limited until next year, Jan 1st-7th. You will be able to withdraw and buy using your PP balance, but you won't be able to accept money and your checkout options will be turned off (like any PP webapps you use).

You don't lose the money. It just gets put in inconvenient stasis.

Re: Will my paypal account become frozen for not supplying tax info?
 

I'm in the same boat my average sale is about $30. You don't even need to be a formed LLC to get an EIN! It's dirt cheap you should look into it.

Re: Will my paypal account become frozen for not supplying tax info?
 

It varies between each account.

200/$20,000 is the quoted amount.

However, paypal has asked for tax info on projected sales total as well.


Bottom line is to be prepared to conform.

Re: Will my paypal account become frozen for not supplying tax info?
 

with a stealth account???