Q&A of the Week November 2, 2022

Question:

What are the new rules for reporting income?

Answer:

There were no changes to the taxability of income. However, there are changes to the reporting rules.

If a taxpayer receives a transaction over $600 from a third-party payment network (ie. Venmo), they will receive a Form 1099-K. This may be for freelance work, a side gig, selling goods, providing services, etc., and all of which are taxable income.

If a taxpayer receives a gift or reimbursement from friends and family through a third-party payment application, this income is not taxable.