4 ms·

How much revenue will this actually raise? The previous threshold was $20k which makes me think this new policy will mostly just result in the IRS catching the

• andrew_ 5y ago
  This is more legislative theater. "We're catching the cheats" where the cheats are as you describe, middle or lower class households or individuals trying to get ahead with a side hustle. I hope to see this reversed in the near future.
  • UncleMeat 5y ago
    Why should a side hustle on etsy be taxed less than a side hustle working at the local coffee shop?
    • LorenPechtel 5y ago
      The side hustle on etsy will likely have plenty of expenses that come off the income--but now you made the person do things like maintain inventory and the like. The compliance burden is a lot higher. I'd like to see some modified rules for sufficiently small businesses--no inventory, no depreciation, you simply take expenses when they are incurred. This would especially apply to service type businesses where your expenses are consumables and tool replacement.
      • PopAlongKid 5y ago
        There already are rules that avoid most depreciation in this case. The Tangible Property Regulations allow a De Minimis Safe Harbor expense deduction for assets purchased, such as a computer or office furniture. The max amount is $2,500.
    • andrew_ 5y ago
      There's another reply in this post about a scenario of selling a couch on Craigslist, as an example. The burden that comes with a simple transaction is undue.
      • UncleMeat 5y ago
        Selling a couch on craigslist would easily be a "friends and family" transaction rather that a commercial one.
    • deleted 5y ago
      [deleted]
• barelysapient 5y ago
  You’re only partially correct: the previous limit was 20k AND 200 or more transactions. So for example, someone taking 100k over 50 transactions was previously unreported. Old rules: https://www.irs.gov/businesses/understanding-your-form-1099-k https://www.irs.gov/businesses/understanding-your-form-1099-...
• loeg 5y ago
  https://home.treasury.gov/news/featured-stories/the-case-for-a-robust-attack-on-the-tax-gap https://home.treasury.gov/news/featured-stories/the-case-for... According to the treasury, the total gap is about $600B/year. > To further ensure that everyone pays their fair share, the Administration also calls for using information that financial institutions already possess—without imposing any burden on taxpayers whatsoever—so the IRS can deploy these additional resources to audit more sophisticated tax evaders. These changes to the third-party information reports are estimated to generate $460 billion over a decade. So about $46B/year from reporting changes. However, contra your intuition that this will mostly impact marginal contractors, the treasury claims that the misreporting is progressive and higher earners misreport more income.
  • BitwiseFool 5y ago
    >"without imposing any burden on taxpayers whatsoever" Do they actually expect us to believe this?
    • ac29 5y ago
      I think the point is taxpayers were already required to report this income and pay respective taxes. Getting a 1099 makes it easier, not harder.
  • LorenPechtel 5y ago
    I'm sure the ones making more misreport more--but they also have more ability to hide it.