Reply to So people will be taxed on venmo and zelle transactions?

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[quote=Anonymous][quote=Anonymous]No.  It means the transactions will be reported, which means that if you are making money and that money is coming to you through Venmo you can no longer hide your income.

For example, my tenant pays the rent through Venmo.  I’ve always reported the rental income, so Venmo reporting the same thing makes no difference to me.

If you’re not hiding your income, you’re fine.  Are you a tax cheater?[/quote]

NP and tax expert here.

The first two sentences are correct.

The third is unnecessarily inflammatory and hostile given the lack of understanding about tax and the amount of misinformation about how taxes and information reporting obligations work. It wasn't helpful. Being concerned about this doesn't mean someone is a tax cheat.

Bottom line is this is no different than a bank account, brokerage or mortgage company reporting information about your payments and interest income, etc. to the IRS. It's no different than a W2. All you have to do at tax time is account for the cash flow on Venmo (which may or may not be "income") when you do your tax return. It certainly adds complexity, but if you reconcile it properly, it's not big deal. PP's flip comment aside, if you've been selling something on Etsy and accumulating money on Venmo and never putting it in your bank account and not reporting that income to the IRS on Schedule C or as hobby income, you will need to start doing that.  But if you're just a passthrough for, say, your kids' travel team and the money you're collecting pays for team tournaments and uniforms or whatever, you just show the expense side of things and have no net income.

It's just reporting cash flow. That's all.

Being wary of this doesn't necessarily equal being a tax cheat, pp. Shame on you.[/quote]

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