IRS tax changes might be driving increased cash and ATM usage
A recent IRS policy change has sent shockwaves through the gig economy and person-to-person payment platforms. As of 2023, apps like Venmo, Cash App, Zelle, and PayPal must issue 1099-K tax forms for accounts with over $600 in transactions.
Previously, the 1099-K threshold was over $20,000 and 200 transactions. Under the old rules, only a few Americans were reported to the IRS and received tax forms. Now millions of Americans earning side income will face new tax paperwork and additional obligations.
The IRS change is intended to increase tax compliance for online income. But it places a huge burden on small-scale earners already struggling with inflation and rising costs. And these new rules could end up driving more cash and ATM transactions.
How new IRS rules impact contractors, gig workers
Under the updated reporting requirements, anyone receiving income through third-party payment apps over $600 will get a 1099-K form in January. The form and associated income must be claimed on tax returns filed in April.
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