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The US Internal Revenue Service (IRS) has delayed the introduction of the new $600 third-party clearing report threshold, saying that it needs to be more clear before operation.

In a new press release, the IRS indicated that because of the suspension, the third-party clearing business would no longer need to report transactions exceeding the threshold of $600 in 2022.

In addition, the IRS specified 2022 as the "buffer period" for the implementation of the new threshold, which was formulated as part of the 2021 foreign rescue plan.

"The buffer period... will delay the trading report of more than $600 until 2022. The buffer period is committed to promoting the financial and tax compliance of the TPSO (third-party clearing house) and the reasonable connection between my payee and the corporate income tax report.

In the case of third-party online transactions, the payee refers to the owner who accepts payment from the third-party clearing organization. "

The IRS indicated that it could provide a modest 1099 form to ensure that a new threshold was reported to the required taxpayers at the appropriate time.

"The change of national laws and regulations is very important, especially when the quota is to be reported (such as Form 1099-K), the tax compliance is higher. However, the IRS emphasizes that it must be careful to manage the method to ensure that 1099 K is only distributed to taxpayers who should receive such information.

In addition, the most important thing is that taxpayers should master the results of the report, and tax preparers and software suppliers should grasp the information needed to assist taxpayers. "

According to Doug O'Donnell, the agent director of the IRS, the extra time will help taxpayers fully switch to the old system.

"In order to make orderly progress to ensure that taxpayers, tax professionals and the industry are clear, the tax bureau will delay the implementation of the 1099-K change. The additional time will also help reduce the confusion in the upcoming 2023 tax declaration quarter, and provide taxpayers with better time to prepare for a new application."

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