Venmo 1099-K for >$600 on 2022 state taxes - any recourse?

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BogleKev
Posts: 39
Joined: Sat Nov 30, 2019 9:40 am

Venmo 1099-K for >$600 on 2022 state taxes - any recourse?

Post by BogleKev »

I got a 1099-K from Venmo for tax year 2022 because a clueless relative checked the "Goods & Services" box back in January 2022 when repaying me $720 for her piece of a hotel room from a family trip. I let it go because at the time it did not seem to make a difference either way. Or so I thought. Now I come to find that, even though the Feds/IRS have delay the reporting requirement on Venmo G&S payments >$600 until the 2023 tax year, my state (MA) is one of 2 or 3 that have decided to implement the tax for 2022.

I am most likely going to simply not report it on my MA taxes and let them adjust my refund by the $36 if they catch it. I know, why not just report it and pay it? The principle I guess. I am wondering is there any way I can get this reverted based on the fact that it was a relative, and it happened before the Biden administration even proposed this new tax? Venmo online help is not helpful, except to say once the transaction is closed it cannot be reversed.

I'd like to keep the discussion focused on the tax aspects, and whether I have options, and not get into any political opinions about the validity of the $600 limit and the unique tax situation in MA. I'll save that for a different online forum. :happy
toddthebod
Posts: 1165
Joined: Wed May 18, 2022 12:42 pm

Re: Venmo 1099-K for >$600 on 2022 state taxes - any recourse?

Post by toddthebod »

The IRS says to include it on Schedule 1 line 8z as "1099-K received in error" and then include a negative offset on line 24z with the same text.

In Massachusetts you just leave it off:
Molly goes to dinner with her 14 graduate school classmates to celebrate the end of the term. She pays for a $1,500 meal on her credit card and her classmates reimburse her for the expense via a peer-to-peer payment system, totaling $1,400. That $1,400 IS NOT subject to tax or any reporting as it was not payment for goods or services, but simply reimbursement.
https://www.mass.gov/service-details/fr ... processors
Backtests without cash flows are meaningless. Returns without dividends are lies.
Topic Author
BogleKev
Posts: 39
Joined: Sat Nov 30, 2019 9:40 am

Re: Venmo 1099-K for >$600 on 2022 state taxes - any recourse?

Post by BogleKev »

toddthebod wrote: Tue Jan 24, 2023 7:06 pm The IRS says to include it on Schedule 1 line 8z as "1099-K received in error" and then include a negative offset on line 24z with the same text.

In Massachusetts you just leave it off:
Molly goes to dinner with her 14 graduate school classmates to celebrate the end of the term. She pays for a $1,500 meal on her credit card and her classmates reimburse her for the expense via a peer-to-peer payment system, totaling $1,400. That $1,400 IS NOT subject to tax or any reporting as it was not payment for goods or services, but simply reimbursement.
https://www.mass.gov/service-details/fr ... processors
Thank you for this, todd. It is a big help.
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