mongoose wrote (View Post): › "...www.FreedomWorks.org says that “Senate Housing Bill Requires eBay, Amazon, Google, and all Credit Card companies to Report Transactions to the Government”. This was what the original post by LurkeyLou covered, including a longer quotation from Freedom Works which you partially duplicated. Perhaps if you had read past the words REAL ESTATE in the original post you could have saved yourself a lot of time spent in denying it and spent more time doing new research on the topic. And you are absolutely right in it being a big business bailout masqueraded as a public protection measure. Who always pays for bailing out big business for taking on and failing of high risk ventures -- mom and pop America.

That same message I posted is all over the web. Everyone is copying it. I don't know for sure yet but I think it may have orginated from Mr. Mortgage. I read someones post stating this.

As for going through all the denials, when my online gig was starting to take off on Ebay and they raised their listing fee's to 5/10 cents I was really in denial then. I was getting into a profit margin I could afford to the pay taxes then they upped the listing and FVF and put me back into the toilet. Same thing will happen if this IRS reporting deal happens. I will have to start all over building again around the reporting.

This will slam alot of internet only businesses. B & M 's on the internet aready pay taxes so they will only get hurt alittle.

I'm trying to get my internet gig to a level of income I can pay taxes on but this will just slam me back down.

"...starting to take off on Ebay and they raised their listing fee's to 5/10 cents I was really in denial then..."

Understandable, been there and done that.

As an IRS EA I am constantly astounded by info spewing forth from the bowels of the IRS. Add to that the daily "revelations" I make as a paid political analyst and written commentator, I'm amazed we are still a relatively free and prosperous country.

Big government + big business = taxpayer screwed a new way almost daily.

The same article is posted in every news outlet on the internet with just a few changes. Here's a passage with more clearer language from one of the "Same" type articles:

****The proposed law contains an exception for businesses with fewer than 200 transactions or a total value less than $10,000. Quoting FreedomWorks chairman Dick Armey (former House majority leader) from the article:**********

"The proposed law contains an exception for businesses with fewer than 200 transactions or a total value less than $10,000."

I believe there may be some misinterpretation of the actual wording of the proposed amendment. The way that you state you've found the exception for small businesses floating around the internet is incorrect. The actual wording of the proposed amendment clearly states that the de minimis exception applies to small third party processors, not small businesses.

An example would be a small commercial bank, S&L or Credit Union who may only process 30 or 40 wire transfers (EFTs) per year -- all under $10,000 cumulatively -- as a third party processor for others. There is no mention of an exclusion for the payees (the business or individuals receiving the funds from the processor/s) based on either size nor volume.

Dick Armey didn't make comment on any exceptions. The only exceptions delineated were in the body of the proposed amendment itself, usually posted after the Armey quoted comments.

The actual clause in the proposed amendment:

"A de minimis exception for transactions of $10,000 or less and 200 transactions or less applies to payments by third party settlement organizations." (emphasis added)

edited for grammar...

The same message is out on the internet all over the place with these little changes. Alot don't even have the de minus exception rule written in them.

People are adding and subtracting on the same message before they copy it to their posts and websites.

Still all means one thing, we're screwed again!

Mongoose,

You are a Gem with an elegant pen.
That thinking cap of yours ain't bad either.
A most excellent series of posts.

I just read a long article in Fox Financial about this bill. While it described the intent, addressing foreclosure problems, and the controversy surrounding it along with a threatened presidential veto if not modified, it does not discuss any of the Revenue Provisions (how money is to be raised to help pay for it), including this amendment about third party processor reporting.

If the bill passes, and most political pundits believe it will, this amendment will be included in its passing.

The major media essentially either thinks this amendment is a good idea by insuring "fair" tax compliance, or a non issue in the larger scheme of things.

If you're interested, the article that addresses the bill, but not his amendment specifically, is:
$300B Housing Rescue Plan Passes Key Senate Test
http://www.foxnews.com/story/0,2933,370601,00.html

Yea, I passed by this article yesterday. Government has to bail the homeowners out because It's the government that let this happen in the first place.

It's the government that encouraged home loans be given to risky borrowers so people that wouldn't ordinarily be able to afford to own their own house could get into a new home.

The government just didn't factor into the plan that the adjustable rate numbers would skyrocket up and overload these risky loans.

Countrywide is the one that's getting the "bad guy" hat because they went "banana's" giving out these loans to risky borrowers when it's the U.S. government that encouraged it to help people get into their own homes.

Here's a passage I copied from a piece of an aritcle on the site:

********A third provision requires credit card companies to inform the IRS of payments they make to merchants for credit and debit card transactions. This would allow the IRS to better track business income, raising some $9.8 billion. Finally,the bill closes a loophole used by foreign multinationals to avoid taxes on income earned in the United States, raising almost $7 billion.*******

I know I will not be using my credit or debit card anymore. Back to cash and checks. Doesn't say anything about Paypal's "Instant Pay". That's a cash transaction though a third party and this is unclear to me weather or not this type of payment will be included in the IRS reporting by Paypal. To my knowledge no other online payment service has the "Instant Pay" option yet. Just Paypal. The other services just do 4 day transfers from the buyers bank account to the sellers bank account. Paypal is the only online payment service that has a "bank" type holding account to hold cash in.

At least we have a little time to work out a solution to avoid the IRS letters.

Mongoose, you silver-tongued devil you!!! Thank You for a understandable version of this bill.

This bill, if passed, will be the end of eBay.

This proposal will be the end of American citizens "right to privacy". I make all my daily personal purchases with my debit and credit cards (gas, food, household supplies, general bills, car care, etc..........). I do way more than 200 transactions a year with my cards. If this passes it won't be long until all electronic transactions will be monitored, even automatic deposits and payments into and out of bank accounts.

The government will be able to track every citizens every move.

Ocean writes: It's the government that encouraged home loans be given to risky borrowers so people that wouldn't ordinarily be able to afford to own their own house could get into a new home.

The true fault lies with the individual, jointly and severally, who did or does not understand the true meaning of a balloon payment (as if 5 years is an eternity).

Who did not do their economic homework to learn/realize/or remember the Jimmy Carter years of 20-22% interest rates *shudder* (1980) so things are bound to fluctuate. Interest rates have been very low(which is not a good thing: in the depths of the Depression you couldn't give 2% money away: no place to put it to work).

Who failed Econ 101:the simple supply/demand curve a/k/a Samuleson's guns and butter.

Who failed to be cognizant that inflation is a two edged sword.

Who thought the rising home price party could go on forever. They are now buried and it isn't in confetti.

In 2004 premium gas in L A was $1.65.
In 2008 it's $4.85 looking soon to be $5.00 with no end in sight.
That's the knife at our collective throat.

We'll skip over Nixon and Stagflation.
I suddenly have a headache.

I do agree the person that borrows the money from banks and lending instuitions are responsible for knowing the ups and downs of getting into an adjustable rate mortgage and all the costs involved with owning their own homes.

But, the banks and lending intuitions don't normally give out loans to border line home purchasers that don't really have the income to cover the the "ups" in an adjustable rate mortgage. These are what is referred to as "Risky Loans".

The U.S. states government this time around encouraged these risky loans be given out and Countrywide handed these loans out right and left with the U.S. governments approval. This is well known throughout the banking industry. They are all just zipper mouthed about it.

Lots of Congressmen also got caught taking out "Special Deal" loans from countrywide that are at rates way under what was given to the general public. This is not legal and these Congressmen are being investigated for being given these "Low Rate" loans.

As for the gas thing, there are multiple factors driving up the gas prices including "Supply & Demand", "Speculation over oil futures", "Opec price increases due to the coming of alternative fuels and hydrogen cars", "No new oil refineries being built in the U.S. for 30 years to meet demand" & "No increased oil drilling in the U.S. because of the -Green People-".

Economics 101, passed!

"That's a cash transaction though a third party and this is unclear to me weather or not this type of payment will be included in the IRS reporting by Paypal."

PayPal is one of many payment services where money is debited from a participant's bank account, or taken from an existing balance maintained with the service, and processed as "instant" pay. RME is another one of these services (though not quite as "instant").

Regardless, it doesn't matter. It is a third party processor of financial transactions and therefore covered by this amendment, subject to reporting.

"This proposal will be the end of American citizens "right to privacy".

Not necessarily. The aggregate accounting and reporting by this amendment only pertains to the recipients of the money, not the payer of the money. In other words, this program tracks the payments received by the sellers, not money spent by buyers.

It's not really a slippery slope toward monitoring all financial transactions by each individual because there are already laws in place dealing with that. A couple of examples have to do with aggregate daily cash deposits made by one entity which have to be reported to the fed; and, the fact that the IRS and some law enforcement agencies can, without warrant nor stated probable cause, demand and receive any and all back accounts, credit card records and such, held by any entity based on tax ID# (or SS#).

The concept of right to privacy, secrecy of financial transactions in this country is pure myth already.

As to prognostications of the end of eBay, or the end of online sales as we know it now, I doubt there will be much of a change from the way that things are now. The vast majority of people running businesses online already do report the bulk, if not all of their income, derived through their businesses -- this will just force them to be more accountable of all of their revenue and expenses. Some people don't report their income either because they are truly unaware of the need to, or believe that they are so small that it doesn't matter. Now they'll find out if they're actually too small or if it matters.

Most people who want to continue selling online and don't currently declare their income, are going to begrudgingly go through the transition of reporting their income, kvetching the whole time (rightly so), but continue with business as usual.

Many sellers are going to switch to cash -- check or money order only -- in attempt to avoid reporting of their sales. They may be able to stay in business, at a lower volume of sales -- by making such a switch; or, they may fade into the annals of sales history. Most sellers are going to continue to use third party processors because the buyers are going to prefer the relative convenience, anonymity of providing personal information to a reputable, known financial institution, and the safety of securing a refund if it's a bad experience (not arguing the integrity of PayPal, only the generally held perception of such). For every seller who goes to a cash only basis, there will be a plethora of sellers offering the same or similar items with the convenience of third payment systems available. The seller of truly unique items (i.e., handcrafted art or "one of" items) will have more latitude than a seller or somewhat generally available items.

And even if through a massive coordinated effort (doubtful as we can't even move everybody in one direction off eBay) the majority of sellers switched to a cash basis only, they'd only be playing into eBay's and the politician's collective hands to force all eCommerce transactions to be completed via a third party processor for accountability. eBay would be ecstatic because they could push their PayPal only agenda; and, the politicians, and their revenue collectors, could force additional accountability throughout the internet, including all sales venues.

If not already doing so, it might prove both easier in the near term, and more profitable in the long term overall, to just bite the bullet and "properly" declare your income derived from your business efforts. In all actuality, the government is just closing a rather large loophole that's been exploited by people from all walks of life for a long time. As the old adage goes, all good things eventually come to an end.

I already want to pay the taxes but my profit level isn't there yet and with all these transitions when Ebay or the government changes something puts me back into a borderline income situation.

I have to get stablilized somewhere on the internet that has traffic so my income can grow and get to a level I can declare the income without it killing me. Like I said, it was happening on Ebay until they did two major price highs in 1 year because they went public and started to sell stock.

As for the payee only getting monitored, if I make a purchase of food at a grocery store and used my credit card to pay for the purchase then the credit card company reports the transaction to the IRS, wouldn't the credit card company have to disclose to the IRS the identity of the payer of the money and the details of the transaction or transactions if the IRS computer sent up a Red Flag? Wouldn't the IRS computers have to store detailed information of each transaction including the payer of the monies identity if an investigation was warranted on the Payee?

Even if this proposal doesn't pass it's real good to have this dicussion so all is known for years to come when the govenment does start taxing internet transactions.

I'd say the ACLU should have a look at this one instead of protecting the "Civil liberties and rights of illegal aliens" that don't have any "civil liberties or the rights of American citizens".

Stupormarkets have been monitoring your purchases and compiling your profile for several years. That's an unhappy thought. But true.

California: I write a check: I give them my phone number; next time I write a check it goes though to my bank account same instant without providing any additional documentation. I swipe a credit card: my purchases are also added to my profile. They know exactly what I purchase, how much, and how often. Lots of Big Brothers are watching.

At certain threshold amounts the Market hands me a 5% coupon. I'd rather they lower prices but I don't run the joint.

Heard in 1962:''Pay the IRS every cent you owe and not a penny more.''
George Petersen, CPA
(d. 2000)