WASHINGTON – U.S. Senator Bill Cassidy, M.D. (R-LA) re-introduced the Red Tape Reduction Act to increase the threshold on 1099-K tax forms when individuals and entrepreneurs sell goods online. The Biden administration and every elected Democrat inserted a provision to the tax code in the American Rescue Plan Act that requires third-party payment platforms to report businesses’ gross transaction volumes totaling more than $600 to the Internal Revenue Service (IRS). Prior to this provision, payment providers were only required to report information when a payee had over 200 commercial transactions per year that exceeded $20,000. As a result of the new provision, thousands of small businesses will have to fill out 1099-Ks to provide their personal information to the IRS.
“Enough challenges come with running a small business. If we can make it easier by getting rid of unnecessary paperwork, we should,” said Dr. Cassidy.
Cassidy was joined by U.S. Senator Maggie Hassan (D-NH) in reintroducing the bill.
The Red Tape Reduction Act will raise the threshold to $10,000 from $600, ensuring that fewer small businesses and casual sellers receive excessive paperwork for online sales.
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