Escrow doesn't send a 1099?

[The Rover]

Not looking for tax advice - just a general question. I was under the impression that if your business pays out over $600 in any given year to an individual or business, that you are required by the irs to send your payees a 1099-MISC. After speaking with Escrow.com, they said that they do not send a 1099 to their payees, which I thought was strange. Can anyone shed any incite as to why they are not required, even though they are a U.S company?

 

[JB Lions]

I wouldn't be that quick to assume that such a threshold would be that rare. I know 5 people off the top of my head who use paypal as their main third party processor who far surpass this threshold, in which case they received a 1099 from paypal. 200 transactions and 20k in a fiscal year isn't that difficult to achieve if you have a full time web business, whether it's selling domains, products or services.

Members: 200,080, Active Members: 3,103

99% is being generous. If you want to use active users, 31 people.

i dont think he'd care if any of this applied. of course people living outside the U.S. wont get this..

also, why are you so upset? this aint the gTLD thread danielson..

Wasn't upset at all, you're probably reading it wrong. gTLD threads don't upset me either, you're the one into them, not me. I actually think they're funny.

 

[johname]

You can do 200 ebay paypal transactions in a year no problem.

 

[JB Lions]

You can do 200 ebay paypal transactions in a year no problem.

Start a poll here, let's see how many people got 1099's this year from PayPal. Don't remember if it was a poll here or somewhere else but I remember it pretty much saying most people were more hobbyist domainers or just something on the side of whatever else they do. So, I doubt there are more than 30 people here hitting that threshold.

 

[mjnels]

Start a poll here, let's see how many people got 1099's this year from PayPal. Don't remember if it was a poll here or somewhere else but I remember it pretty much saying most people were more hobbyist domainers or just something on the side of whatever else they do. So, I doubt there are more than 30 people here hitting that threshold.

what does it matter how many people got a 1099-K from paypal? they're required to send one out once you hit the threshold, just like escrow.com is now..

all this other stuff you're talking about is irrelevant..

 

[johname]

I didnt mean 200 ebay domain names. I meant there a massive amount of people in general selling 200 things a year on ebay. Since you have to use paypal, then paypal reports that income.

Its relevant to show how easy the 200 threshold can be hit

 

[JB Lions]

I didnt mean 200 ebay domain names. I meant there a massive amount of people in general selling 200 things a year on ebay. Since you have to use paypal, then paypal reports that income.

Its relevant to show how easy the 200 threshold can be hit

Yes, I know, ebay talks about that in their forum. I talked to my accountant about it last 2 years. My response was to this forum, when The Rover, was talking about other ways as well.

what does it matter how many people got a 1099-K from paypal? they're required to send one out once you hit the threshold, just like escrow.com is now..

all this other stuff you're talking about is irrelevant..

Paypal is pretty irrelevant, since I think we started talking about, the original question was about Escrow. Escrow said one thing, but you obviously know more about it than their accountant.

 

[mjnels]

Yes, I know, ebay talks about that in their forum. I talked to my accountant about it last 2 years. My response was to this forum, when The Rover, was talking about other ways as well.



Paypal is pretty irrelevant, since I think we started talking about, the original question was about Escrow. Escrow said one thing, but you obviously know more about it than their accountant.

OP mentioned paypal so i talked a little bit about it. geebus crisp man we're talking about all third party payment processors - paypal, escrow.com, amazon.. doesnt matter.

an accountant has nothing to do with anything.

 

[JB Lions]

"an accountant has nothing to do with anything" that and mentioning cut and dry in dealing with taxes, pretty ridiculous.

In the end, Escrow told him one thing. I'm going to go with that, since I'm sure they know their business better than you. Have a certified accountant, probably a lawyer on tap as well.

Escrow/their accountant or mjnels

 

[Kenny]

are there any domainers out there who send escrow.com a 1099?

Now that would be nice, to be paying so much in escrow charges to 1099 escrow.com!!!

Peace,
Cy

 

[mjnels]

"an accountant has nothing to do with anything" that and mentioning cut and dry in dealing with taxes, pretty ridiculous.

In the end, Escrow told him one thing. I'm going to go with that, since I'm sure they know their business better than you. Have a certified accountant, probably a lawyer on tap as well.

Escrow/their accountant or mjnels

its not debatable.. its a law all 3rd party payment processors are required to follow.

its like asking a lawyer if i need to stop for a red traffic light... its a law, there is no opinion to offer.

 

[verbster]

Okay, let's say the $20,000 / 200 transactions rule is in place for them to send you a 1099-k. On the other hand, let's say you use them 20 times, and you paid them their $35 fee 20 times ($700). Wouldn't you need to send them a 1099 to indicate you've paid them over $600 (that they must claim as income)?

 

[mjnels]

Okay, let's say the $20,000 / 200 transactions rule is in place for them to send you a 1099-k. On the other hand, let's say you use them 20 times, and you paid them their $35 fee 20 times ($700). Wouldn't you need to send them a 1099 to indicate you've paid them over $600 (that they must claim as income)?

dont know but 1099-K is gross payments - so includes fees you were charged, includes money you later refunded, etc... if you meet the threshold its important to use this exact gross payment figure now because the government was sent an exact copy of what you got... fees, shipping charges, and all. for some people its changed the way you keep track of the money you made since the entire chunk includes fees, etc..

we're getting closer to "consult an accountant" territory now though... which by the way, i think its hilarious how people on the internet beat up on each other over "not being an accountant, doctor, lawyer, etc" when the question is simple yes/no answer.

when you go outside today dont punch people..... however, im not a law expert so consult an attorney first. :yell: