Tax Reminder: No Need to Report Income of at Least $600 from CashApp, Venmo
The IRS delayed the reporting of income of at least $600 paid through Venmo, CashApp and other payment apps. The initial plan was for the payments to be reported this year.
(Tech Daily via Unsplash)
If you’re getting your paperwork together to file your taxes as your W2s hit your mailboxes, there’s one less thing you’ll have to worry about, especially for entrepreneurs.
Remember when the IRS said if you’ve been paid $600 or more through third-party settlement organizations – such as CashApp, Venmo and Paypal – you’ll have to start reporting that income on your taxes? And, it was supposed to start this year.
Well, you’ve got more time. Tax filers who fall into that category will now be required to report that income on next year’s taxes.
Still not sure how to figure out what’s defined as a payment that needs to be reported to the IRS when that $600 reporting threshold comes into play?
Yes
- You’ve agreed to cook for your cousin’s birthday party, and make the desserts. Your uncle wants to encourage you to get your catering business off the ground and pays you to cook for your cousin’s birthday party, and make the desserts. He sends you money through Paypal. You get more clients and they also pay you through Paypal.
- You’re an artist and sold several paintings at a vendor fair and you’re paid through CashApp, Paypal or Venmo.
No
- You’re going to the mall and the grocery store and your brother sends you a food list and also wants you to buy him a suit and he sends you $750 through CashApp to cover everything, including gas money.
- It’s Christmas and your rich auntie sends you $1,000 through Venmo.
The reporting threshold for third-party settlement organizations is currently $5,000 for 2024. Zelle does not report any transactions to the IRS.
Bethal Miles, a Chicago native, is a senior broadcast journalism major at the University of Southern Mississippi.
Edited by NaTyshca Pickett