Millions of people are about to face an unexpected headache next tax season. Hidden within the American Rescue Plan Act of 2021 was a provision that drastically lowered the reporting threshold for transactions through third-party payment platforms such as Venmo, Apple Pay, and PayPal. With the threshold lowered from $20,000 across 200 transactions to a mere $600, millions of gig economy workers and casual sellers who rely on platforms such as Uber or Etsy to cover everyday expenses are about to be hit with a deluge of 1099-K forms — and the confusion and possible tax liabilities that come with them.
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