By Charles Owens, Bluefield Daily Telegraph, W.Va. (TNS)
Area lawmakers are protesting a decision by the Biden administration to once again delay the IRS reporting threshold requirement for online purchases.
Prior to the passage of the American Rescue Plan, 1099-K forms were issued by the IRS to taxpayers who exceeded 200 transactions totaling $20,000 in a tax year. However, the American Rescue Plan drastically changed the reporting requirements, and now any electronic payments and transactions from online platforms, apps, or payment card processors equal to $600 will qualify for the 1099-K requirement.
Adding to the confusion the IRS this week once again delayed implementation of the new threshold requirement.
U.S. Rep. Carol Miller, R-W.Va., said Congress never gave President Joe Biden the authority to change the reporting threshold for online purchases.
Based upon the latest move by the IRS, Miller said the implementation of the 1099-K requirements will now be delayed for the 2023 tax year at the threshold of $20,000 and then will implement a $5,000 threshold for the 2024 tax year. That will hurt taxpayers and create additional confusion, according to Miller.
“The IRS is completely out of control and must be held accountable as they continue to make up the law as they go,” Miller said. “Last year, the IRS took the legally dubious action of delaying implementation of the lower 1099-K threshold for 2022. Now they’ve done it yet again, giving American taxpayers no certainty on what the future of this policy will hold. The Biden administration must be reminded that Congress writes the laws, they are the ones who must correctly implement them.”
Miller said taxpayers deserve certainty when using online payment platforms and participating in the gig economy.
Miller said she has introduced the Saving Gig Economy Taxpayers Act. That bill would keep the reporting requirement at $20,000 and over 200 transactions. It has already passed the Ways and Means Committee and stands ready for a vote on the House floor and swift passage in the Senate.
U.S. Senator Shelley Moore Capito, R-W.Va., also is protesting the IRS’s decision to delay the reporting threshold requirement for online purchases, which Capito calls a “tax scheme” included in the Democrat-backed American Rescue Plan.
“This very provision was included in the American Rescue Plan that was passed with only Democrat support,” Capito said. “Republican efforts to repeal these new requirements have been ignored by my Democrat colleagues until they realized the massive complications that would ensue during tax filing season. However, this is now the second time they have delayed implementation, which only leads to uncertainty for taxpayers. While I was glad to push for a congressionally mandated one-year delay, I remain concerned about what authority the IRS has to enforce their delay and will continue working to find a lasting solution.”
Capito said Democrats—who control the U.S. Senate—should take responsibility for the problem they created and fix it.
Capito has introduced several bills in the Senate to stop the Democrat-backed tax plan for online changes. Her bills include the Emergency Taxpayer Paperwork and Audit Relief Act, a measure that would have delayed the tax change; and the Stop the Nosy Obsession with Online Payments, or SNOOP Act, legislation to strike the tax code provision inserted in the American Rescue Plan that requires third-party payment platforms to report businesses’ gross transaction volumes totaling more than $600 to the IRS.
Capito said a reversal of the threshold changes similar to the SNOOP Act was included as a provision in the Small Business Jobs Act in the Republican-controlled U.S. House of Representatives. There it has already passed the Ways and Means Committee and stands ready for a vote on the House floor, according to Capito’s office. She hopes the bill also will pass the U.S. Senate.
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