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Paypal asking me to verify tax information

Discussion in 'Ebay' started by krilla95, Aug 2, 2014.

  1. krilla95

    krilla95 Newbie

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    "Provide your tax reporting information
    We'll use your tax ID number to send tax Form 1099-K to you and the IRS if the payments you receive in a calendar year go above both of these levels:

    $20,000 USD in gross payment volume for goods or services
    200 payments for goods or services
    Please provide your tax ID number today. That will help you continue to sell with PayPal and avoid any interruption to your PayPal service.

    You can find more information about the new tax rules and why we need your tax ID number at "

    What happens if I dont supply them these documents?
     
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  2. sashablack

    sashablack Elite Member

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    I would assume they will close your account? If you are making crazy money then I would say pay your taxes before the tax man comes and messes up your life :)
     
  3. Almenocinque

    Almenocinque Junior Member

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    If you do not supply them the documents then you will not be able to withdraw any money at all and they have also the right to report you to the IRS, better be on the safe side and play along with them.
     
  4. PHPInjected

    PHPInjected Jr. VIP Jr. VIP Premium Member

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    Submit your tax information. If you are making good money, that is a must.
     
  5. krilla95

    krilla95 Newbie

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    My sales dont even come close to 20k though, i made up to 200 transactions with low price product like 5-10$ per item. Should I still give them the info?

    Also, what if im on a stealth account? Cant they check the names and realize my SSN doesnt match up with the names on ebay/paypal?
     
  6. D4RK KNIGHT

    D4RK KNIGHT Regular Member

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    krilla95

    What have been your transactions on the account that got that message?
     
  7. krilla95

    krilla95 Newbie

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    Ive been selling a bit of clothes, alot of wristbands(5$each) and just started drop shipping from China
     
  8. D4RK KNIGHT

    D4RK KNIGHT Regular Member

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    Can you give me that number of sold items exactly and then the amount in sales you sold on the account exactly?

    Im going to advise you on what to do and tell you your options but I first want to know your total sales to the penny.
     
  9. krilla95

    krilla95 Newbie

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    Ok hold up lol, i've been asking for a friend so im gonna have to get the exact details. I myself just started a stealth account so i wont have to worry about this(yet) lol

    edit: 6000$ of sales and 162 transactions
     
    Last edited: Aug 3, 2014
  10. jmt123

    jmt123 Regular Member

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    They ask for that information if they project that you will reach 200 or $20,000 for the year. Your transactions probably was what triggered it. If you don't provide an EIN number, your Paypal will be limited for the rest of the year but you'll be able to use the account again next year.

    This is why it's best to spread sales across multiple accounts.
     
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  11. krilla95

    krilla95 Newbie

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    My friend has two accounts registered under the same exact info so thast his problem i guess lol.

    do i need a new bank account number for each new stealth account i create?
     
  12. DougG79

    DougG79 Regular Member

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    I am getting close to having 180 sales on one account, what do I need to do if they ask me for documents?
     
  13. jmt123

    jmt123 Regular Member

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    Yes, you need new everything for each account including a new bank account number.

    You usually aren't asked for documents unless they are suspicious about something so you don't have to worry about that. But they will likely limit your Paypal account until you give them an EIN number. If you don't know what an EIN number is, it's basically a SSN for businesses. You can get one for free at irs.gov (just google EIN number and it's the first result).
     
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  14. D4RK KNIGHT

    D4RK KNIGHT Regular Member

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    What some of jmt123 has said is good but he hasn't explained everything so let me clarify a few things here.

    First of all krilla you mentioned earler about giving out a SSN. You never give PayPal a SSN under any circumstances ever.

    Giving PayPal your SSN is one of the worst things you can do if not the very worst thing for so many reasons.

    First of all putting your SSN or a bogus SSN will enolate the credit on that SSN if things go bad on that account because eBay will have that SSN recorded in there system forever.

    Most importantly the IRS has records to databases and could find you and put you in prison if your using someone else's information for identity fraud doing that will get you in way more trouble than you want to be in!

    When PayPal does request a SSN or a TAX ID Number.

    There are 2 options.

    1. Move on and make more stealth accounts and let your account that is being asked for a SSN or Tax ID Number rest until January 1, 2015. Because that is when you will be able to sell on it again if you dont do anything.

    2. I dont like doing this because it compromises your anonymity and your account will only be under eBay's radar only.

    All you need to do is make a business name with the IRS and get a TAX ID Number under it. You will use your real info as just a business contact (for the IRS only).

    Say you call your company "abby normal pool company". When you upgrade your PayPal to a business account, you go and enter that business name when it asks for one. Then your IRS info will match the PayPal info. They will only need this for reporting purposes, They send the IRS information that you made or that much on PayPal and it will be listed as "abby normal pool company". PayPal has no need or reason to get real info. They are just required to post the TAX ID Number with your dollar amount to the IRS. The IRS has your real info and will require you to pay your taxes. They are the ones you need to be worried about. Not PayPal.

    You would NEVER get into trouble with the IRS unless you dont pay your taxes after you go with an TAX ID Number. There is a lot of stuff you will need to do by way of records, etc. Also you cant just file one year and not the next, They will want to know what you did with that business and you will have to show them. A good way to get audited is to file one year and not the next on a business. That will get you every time.
     
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  15. EbayUltimate

    EbayUltimate Jr. VIP Jr. VIP

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    Within 30-40 days if the SSN isnt provided it will get limited. Just get the funds out and and start a new stealth account
     
  16. doublemaltscotch

    doublemaltscotch Newbie

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    lmfao are some of you guys cpas? dam
     
  17. srb888

    srb888 Elite Member

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    And are you from Ganymede, where no one literally knows about PP rules? lol jk

    The knowledge is common and makes sense to know it.

    See here:
    Code:
    https://cms.paypal.com/us/cgi-bin/marketingweb?cmd=_render-content&content_ID=marketing_us/IRS6050W
    If you read that info, then you will know what it takes to know the rules of the site which you're depending upon.

    Esp: This is relevant:

    ~Quote:
    What happens if I don't provide my tax ID number?

    If you do not provide your tax ID number (Social Security Number (SSN), Employer Identification Number (EIN), or Individual Tax Identification Number (ITIN)) after we've requested it, we may place the following limitations on your account:

    • You'll be unable to receive funds into your account.
    • You won't be able to close your account.
    The limitations will be removed after your provide your tax ID number.

    ~Unquote
     
    Last edited: Aug 5, 2014