As a rule of thumb the IRS won’t audit anybody they can’t recoup more from than the cost of the audit. Maybe $20,000 maybe $40,000.
Obviously, the number should be on the higher end because now the IRS is short staffed.
Yeah this is the truth.
Bartender friend I knew bragged about how he always underpaid taxes. Guy was a UFO/lizard people run banks/illuminati kinda guy and even bought crypto and NFTs.
Well, he made big bank and quit bartending. Big show of it and bought everyone drinks for the whole night because he was practically a millionaire. (Assuming. Didn’t really ask)
But came back last year because he needed to make money and constantly blames the IRS for taking everything.
They also won’t audit you if your rich, so there is a nice middle-class sweet spot they can exploit. If your poor though, they may try to still come after you so they can throw you in jail for some of that cheap labor for tax evasion.
Under the Biden administration, as a result of the inflation reduction act, the IRS audited the rich and saw large increases in revenue as a result.
As part of larger efforts taking place, the IRS has stepped up activity specifically on 1,600 individuals whose incomes were more than $1 million per year and who each owed the IRS more than $250,000 in recognized tax debt. Since last fall, this IRS compliance effort has generated more than $1 billion in collections from this group, with work continuing in this area.
Thank you Mr. Trump for protecting the Millionaire and Billionaire class.
Under the Biden administration, the IRS made a concerted effort to target the wealthy, aiming to double audit rates for those making more than $10 million a year and launching a campaign to investigate private-jet owners. Now, especially with the potential dismantling of the Department of Justice Tax Division, the tax enforcement ranks are rapidly dwindling.
“The agency is like a zombie right now,” said Kathleen Pakenham, partner at Vinson & Elkins, who handles corporate and high-net-worth tax cases. “There is no brain in charge of what’s happening on the ground.” -NBC News
Yes, it’s a rule likely based on amount and likelihood to recoup. There’s no incentive to go after people who know how to cheat the system. You gotta go after the folks who don’t know how to fight back.
The current admin gutted the IRS specifically so they didn’t have enough resources to go after the rich
You don’t want to trigger 1099ks? Use zelle.
https://www.zellepay.com/faq/does-zelle-report-how-much-money-i-receive-irs
Oh that’s interesting… Apparently they’re exempt because the money never actually passes through them, they just facilitate direct transactions between bank accounts… Wish it would actually explain the why on their faq page directly, but there you go.
It might only take the smallest cryptodust to trigger a US reporting requirement.
You know what happens if you fail to report some income? You get a notice 6 months later for the amount owed. That’s it. It’s no hassle at all.
It’s ridiculous that the US doesn’t send a tax bill to citizens like is done in other countries. You get the bill, amend it if there’s anything they missed, and send it back. If they know enough to audit you, they know enough to send the tax bill.
The reason the US doesn’t do that is thanks to lobbying by companies like Intuit and H&R Block.
They are why Luigi needs to be set free tbh
Who successfully lobbied the trump admin to make free filing even harder
It has more to do with legislators using the tax code as a way to give away money for certain activities than tax prep lobbying. It’s also a lot of fear mongering by those companies, and a general lack of reading comprehension. If you don’t have to file quarterly, your taxes are likely very easy.
Yeah, but it’s not income if it’s a gift.
Not quite. The meme is referencing a new law that targets platforms when the money is sent as a payment. So, for example, if you Venmo your roommate 2k over a year for utilities, your roommate is fine unless you mark it as for a vendor (there’s a little toggle whose exact text I forget). This meme is making that joke.
That’s strange that they allow the sender to do that. The way it was when it first started is that everyone got the 1099-k over the $600, even for personal business.
I sell a lot on ebay so I have to deal with this, but I usually have expenses like shipping to deduct. It’s a pain because I also sell personal items, so as long as I can show my basis in the item I can deduct it. This becomes difficult in certain situations. I bought factory alloy wheels for my car and sold the steel wheels for around $50/ea plus shipping. What is my basis in the wheels? It’s part of my car technically, but what percentage of the purchase price of the vehicle was wheels? I just didn’t bother trying to deduct that.
I do a lot of con/fair/vendor stuff and support. I have heard (but never done because that’s illegal) that among friends it’s very common to not check that flag to save those friends some headache. It’s also a really good way to get scammed if you do it for strangers on the internet.
I suspect that platforms push it down to the users to reduce their compliance burden. Why make life better for your end users by spending some money when you can just make life more complicated for small businesses by having them own everything even the things they don’t know about?
There’s so many accounting rules it’s too difficult to know what’s what.
Venmo, or any service, would be responsible for producing said tax form if they are also reporting the funds to the IRS. So she would be made aware of the tax form.
If anyone wants to test this though you’re welcome to venmo me $601. I’ll take a few volunteers just to make sure there are no flukes
Shoot me your Venmo login and I can just upload the funds directly. You shouldn’t be the only one having to do all the work of testing this, let me at least take that much off your plate.
Sure thing!
Id: AzureDiamond
Pw: *******
Gotta pick a service where they have an account but deleted the app and don’t use it.
If they’ve moved and it’s on an old email… yeah… good luck getting that 1099 to them at the old address without an email.
I feel like most people ignore these kinds of forms and alerts. Like, you have to be paying attention to emails from venmo, and on top of that know what a 1099K even is, then you have to remember you have one while filing your taxes.
I figure most people never submit them and it’s all to small for the IRS to go after.
Y’all aren’t searching “1099” in your email during tax season?
wtf is tax season? do u mean deer season?
Tax season is a term that applies to the period that the US federal government accepts tax return documents for the previous year.
But venmo will supply a copy of 1099k to the irs and the girlfriend.
Plus the $600 threshold applies in 2026.
2025 is $2,500.
Have to title it something too - like ‘pay for services rendered’
I’m not american but we also have yearly tax here and if I’m ever audited I’m FUCKED. I don’t have a singe document saved. But also I’m super poor so id think they want me
This whole yearly tax thing seems like so much unnecessary work to me. Here in the UK we have a “pay as you earn” system. Taxes get deducted from your wage automatically every time you get paid and it’s all recorded. No extra steps needed. You only need to do extra reporting if you have significant income from other sources e.g. owning a business and getting dividends.
oh, it’s not either/or, we have both. SO FUN!
That’s how I suppose it works in every country.
The thing is that many people have other sources of income that are not paychecks. Thus why most people need to do this yearly declarations. But it is true that in any modern country this declarations are pre-made by tax agencies and it’s easier to fill.
And there’s also deductions. In many countries people can get tax deductions by many reasons and in most places you need to manually ask for them and fill the requirements.
Here for instance we can deduct money paid to Unions from our taxes. As political and syndicate afiliation is protected by law those payments are not automatically reported to the tax agency so if you paid them you have to manually fill the tax return.
I doubt there’s a country that doesn’t take deductions for tax on every paycheque. And it’s usually slightly more than you end up owing at the end of the year so they get to use it for half a year.
Doing taxes is basically to get that back, especially if you take advantage of things like retirement savings plans outside of work, or charitable donations that get written off.
I don’t think it works that way for personal payments. My gf venmos me that or more all the time for her share of the bills. It’s not income.
That’s because it’s repayment for a brief loan. Without it being her share of bills, it would be a gift, which would be taxed after $10k iirc.
Not in the US or canada
It is astounding how many people make tax law social media content without any actual knowledge of how the tax code works. So many influencers think they’ve found a genius tax loophole, as if the professionals who actually wrote the law and fully understand it weren’t smart enough to think of how somebody might try to exploit it, and broadcast their dumb ideas to others who also don’t understand the tax code, peddling advice that will get someone audited and possibly prosecuted for tax evasion.
That’s not actually how it works for personal payments, right? for example, a group of roommates using Venmo to split rent wouldn’t prompt Venmo to generate a tax form or report to the IRS.
It will, as long as it exceeds the threshold for the year. It will trigger an automatic 1099k. It’s up to you when filing your tax return to “label” it as rent payment.
Venmo categorizes payments differently if they’re repayments between friends or payment for goods and services at the time it’s payed though, and everything I’ve found says they only count payment for goods and services towards the $600 total for the automatic 1099k.
