Rep. Raja Krishnamoorthi (D-IL) said on Tuesday’s Fox News Channel broadcast of “America Reports” that the requirement in the American Rescue Package reducing the reporting limit for payments through PayPal and Venmo to $600 is a terrible idea and that the threshold should be increased or the rule’s implementation must therefore be delayed. Krishnamoorthi contended that reducing the bar would result in people receiving 1099-K forms when they had made no money at all, and he agreed that it is common practice to have to modify laws like the American Rescue Plan years after it is established.
“I do not however agree with this specific rule, so I have actually co-sponsored measures to substantially increase the threshold,” Krishnamoorthi said. “And today, I’m urging leadership to add a bipartisan postponement of the rule or a raise in the bar as part of the end-of-year spending bill, John.”
“I don’t agree with it since a lot of folks are going to get a 1099-K for money that isn’t truly taxable income,” he continued. “So, let’s assume you received a Taylor Swift ticket somehow, magically, and then resold it because you could not even attend the show. You most likely did not have taxable income since the cost at which you sold the ticket was less than the cost at which you bought it. So you genuinely suffered a loss. And it happens all the time when people sell used or pre-owned items.”
“Routinely, legislation is passed and then modified in subsequent years,” Krishnamoorthi said. “The Tax Cuts and Jobs Act is a wonderful example. Many of my Republican colleagues and I are still working to reform the SALT cap, which is completely broken and has raised taxes on many middle-class homes in my area and others.”
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