Source: United States Senator for Louisiana Bill Cassidy
WASHINGTON –U.S. Senators Bill Cassidy, M.D. (R-LA) and Sherrod Brown (D-OH) introduced the Red Tape Reduction Act, legislation that will increase the threshold on 1099-K tax forms when individuals and entrepreneurs sell goods online. The Biden administration and every elected Democrat inserted a provision to the tax code in the American Rescue Plan Act that requires third-party payment platforms to report businesses’ gross transaction volumes totaling more than $600 to the Internal Revenue Service (IRS). Prior to this provision, payment providers were only required to report information when a payee had over 200 commercial transactions per year that exceeded $20,000. As a result of the new provision, thousands of small businesses will have to fill out 1099-Ks to provide their personal information to the IRS.
“The cap the Biden administration implemented in their American Recession Plan is hurting everyone from small business owners to people just trying to pay their rent,” said Dr. Cassidy. “This bill lifts that cap and prevents the IRS from spying on American taxpayers.”
“Ohio small businesses are frustrated with the 1099-K reporting threshold. This red tape hits small businesses and other Ohioans selling products online, sucking time and resources from the smallest online sellers,” said Senator Brown. “By raising the threshold, we can prevent the IRS from interfering with minor transactions and cut down on excessive paperwork.”
The Red Tape Reduction Act will raise the threshold to $10,000 from $600, ensuring that fewer small businesses and casual sellers receive excessive paperwork for online sales.
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