WASHINGTON, D.C. – Today, U.S. Senator Shelley Moore Capito (R-W.Va.) introduced an amendment to the Fiscal Year 2023 omnibus package to delay the implementation of the tax scheme in the Democrats’ American Rescue Plan that lowers the threshold for Americans to receive a 1099-K form from the Internal Revenue Service (IRS) for one year.

“Today I offered yet another solution to the drastic changes to 1099-K reporting requirements included in the Democrats’ American Rescue Plan. Democrats rushed these new requirements into law, without any deliberation or stakeholder input that would help the IRS further audit and track tens of millions of Americans’ transactions. This delay would give Congress time to hear from payment processors, platform sellers, small business owners, and tax preparers, and find the right solution to the problem created by my Democrat colleagues and the American Rescue Plan. Absent this delay, this tax filing season is guaranteed to be a paperwork and compliance nightmare, both for taxpayers and the IRS,” Senator Capito said.

"National Taxpayers Union welcomes Senator Capito's one-year delay of the significant new reporting requirements under Section 1099-K for taxpayers participating in the digital economy. The American Rescue Plan Act lowered the 1099-K reporting threshold from $20,000 and 200 transactions, where it had been for over a decade, to $600 and just one transaction starting this year. Lawmakers now have an opportunity to delay the deluge of paperwork and taxpayer confusion that will result from this policy starting in January, which also buys time to reach a bipartisan solution raising the threshold. Congress should quickly pass this one-year delay before they go home for the holidays,” Andrew Lautz, National Taxpayer Union Director of Federal Policy, said.

“Biden and Democrats thought they could come after Americans’ PayPal and Venmo transactions without anyone noticing. People noticed. This amendment will prevent millions of taxpayers with more than $600 in transactions from third-party vendors from being told by Biden’s IRS that they have a new tax liability this year. Sen. Capito’s amendment will give Republicans an additional year to restore the previous threshold and stop Democrats from targeting Americans’ PayPal and Venmo payments,” Grover Norquist, President of Americans for Tax Reform, said.


Last week, Senator Capito and Congresswoman Carol Miller (R-W.Va.-03) introduced the Emergency Taxpayer Paperwork and Audit Relief Act, legislation that would accomplish the same goal as the amendment and delay the implementation of the 1099-K tax change from Democrats’ American Rescue Plan. 

Prior to the American Rescue Plan, 1099-K forms were issued by the IRS to taxpayers who exceeded 200 transactions totaling $20,000 in a tax year. The American Rescue Plan drastically changed the reporting requirements, and now any electronic payments and transactions from online platforms, apps, or payment card processors equal to $600 will qualify for the 1099-K requirement.

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