The IRS is not imposing taxes on personal transactions between family or friends, which is how a larger part of people utilize Venmo and Zelle.
Most of the people who utilize Zelle, Venmo, and Cash App for their transactions were surprised to know that now the IRS requires them to have information regarding large transactions.
So, Do You Need to Be Concerned That There Is an Eye Over Your Every Money Move?
Well, several users are now concerned that their transactions will be reported to the Internal Revenue System.
one user said on Reddit forums, “Time to squeeze the little guy dry some more.”
Another user stated, “Do I have to report every Venmo transaction between roommates?”
However, CNBC states “No, the IRS isn’t taxing your Venmo transactions.”
It states a new regulation that became effective on January 1 applies to small businesses to ensure that they make payment of their fair share of taxes.
Hence, no, the IRS is not imposing taxes on transactions between family or friends as such online applications are mostly used for such purposes only.
Who Does the New Law Apply to?
It applies to those who get commercial payments through Zelle or Venmo, like for example, the payment received for gig jobs or big sellers on eBay.
That will become confusing for several people.
The good news is that if you are affected, you will now receive a 1099 form from such a payment application to explain clearly what is being reported to the IRS.
Bottom line, for most Zelle, Venmo, and Cash App users, there is no change at all. So, don’t waste your money.