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Can The IRS track your Paypal account?

Discussion in 'Legal Issues' started by turmune, Nov 12, 2007.

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  1. #1
    Hi,

    If my only source of income comes from Paypal and I leave the money in my Paypal account, can the IRS audit me for not reporting that money in my Paypal account?
     
    turmune, Nov 12, 2007 IP
  2. eddy2099

    eddy2099 Peon

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    #2
    Well, you are solely responsible for reporting your income even if it is done through Paypal.

    However, any income earn whether you withdraw them or not is subjected to income tax reporting, as to whether you need to pay taxes in the end would depends on your deduction and the tax laws.

    If your reported income and your lifestyle does not match, it could raise some red flags and you may come up for a dreadful tax audit.
     
    eddy2099, Nov 12, 2007 IP
  3. RobPinnacle

    RobPinnacle Active Member

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    #3
    Depends on the amounts you move in paypal. If you move more then 10 grand through your paypal account they UNDER LAW have to report it to the IRS at the end of the year.
     
    RobPinnacle, Nov 12, 2007 IP
  4. turmune

    turmune Peon

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    #4
    You meant if I moved 10k at one time right?
     
    turmune, Nov 12, 2007 IP
  5. eddy2099

    eddy2099 Peon

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    #5
    I do not recall reading anywhere about Paypal will report any earnings on your behalf. All I read is this

    https://www.paypal.com/us/cgi-bin/webscr?cmd=xpt/UserAgreement/ua/USUA-outside#receive-policy

     
    eddy2099, Nov 12, 2007 IP
  6. MrBrian

    MrBrian Active Member

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    #6
    Interesting, where did you hear this?
     
    MrBrian, Nov 13, 2007 IP
  7. utunes

    utunes Peon

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    #7
    i think that if you earn over 800$ in one year, you are supposed to report it
     
    utunes, Nov 13, 2007 IP
  8. j22

    j22 Active Member

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    #8
    Yeah I even think it's $600 a year you have to report it.
     
    j22, Nov 13, 2007 IP
  9. kentuckyslone

    kentuckyslone Notable Member

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    #9
    That is correct. If you earn $600 or more from any one source you are required to report it. Whoever, or whatever company, pays you in excess of that amount must supply you with a tax form 1099 (In US of course)
     
    kentuckyslone, Nov 13, 2007 IP