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Paypal and the IRS

Old 09-02-14, 04:35 PM
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Paypal and the IRS

So I log on to Paypal this morning and I get a message that they want me to enter my social security number or tax id number if I want to continue using Paypal for my eBay auctions. I click on the link and it says they have to report your sales to the IRS if you reach BOTH 200 transactions AND $20,000 in gross sales. By my count I've had about 140 transactions and made about $3,500 since January 1. I've been selling on eBay for about 10 years and have never been asked for my social.

Is this some sort of phishing scam?
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Old 09-02-14, 04:39 PM
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Re: Paypal and the IRS

Amazon started requiring this a couple years ago. Even though I didn't even come close to the 200 tx/$20K threshold, they imposed their own criteria for requiring it, which was basically anyone who had more than 50 transactions regardless of $ amount.

Their rationale is they want it on file already so they don't have to ask you for it if you do exceed the IRS threshold. I elected to stop selling on Amazon.
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Old 09-02-14, 04:41 PM
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Re: Paypal and the IRS

I remember a couple years back they started doing this. It upset buyers a lot because it was as if the IRS thought eBay selling was a job for most, so that must mean everyone.
I would use caution but the situation is legit. I cant wait for the day IRS auditors start going out on weekends, scouting garage/yard sales.
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Old 09-02-14, 11:53 PM
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Re: Paypal and the IRS

So I called Paypal and the person I spoke with said it was unusual for me to get the request because I'm not even at 10% of the gross sales amount. It's apparently triggered when you start getting close. He told me not to worry about it. Weird.
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Old 09-03-14, 12:20 AM
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Re: Paypal and the IRS

Some people believe that eBay and Amazon are turning over all data to the IRS, which uses the lower-threshold people for statistical sampling purposes. It would not surprise me, large corporations are now in bed with most governmental agencies.
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Old 09-03-14, 07:21 AM
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Re: Paypal and the IRS

Originally Posted by madcougar View Post
He told me not to worry about it. Weird.
Dude, no offense, but he's probably some $7/hr CSR in India. While there probably is no inherent risk, I'd talk to a CPA just to be sure.
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Old 09-03-14, 08:43 AM
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Re: Paypal and the IRS

Originally Posted by Rob V View Post
Dude, no offense, but he's probably some $7/hr CSR in India. While there probably is no inherent risk, I'd talk to a CPA just to be sure.
If this guy was in an Indian call center, his accent was amazing! Seriously. But what he was saying was NOT to enter my social as the system would allow me to continue making sales since I was no where close to the point where Paypal flags you.
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Old 09-03-14, 10:16 AM
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Re: Paypal and the IRS

Originally Posted by madcougar View Post
So I log on to Paypal this morning and I get a message that they want me to enter my social security number or tax id number if I want to continue using Paypal for my eBay auctions. I click on the link and it says they have to report your sales to the IRS if you reach BOTH 200 transactions AND $20,000 in gross sales. By my count I've had about 140 transactions and made about $3,500 since January 1. I've been selling on eBay for about 10 years and have never been asked for my social.

Is this some sort of phishing scam?
There's a way to solve BOTH questions.

Enter a random set of numbers.
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Old 09-03-14, 10:27 AM
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Re: Paypal and the IRS

I have some self-published books on Amazon, and I get a W2 from them every year. I believe the threshold for having to report is around $400. I don't know why eBay/PayPal wouldn't do this for any seller over that amount.
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