Will Apple Pay abide by the 2022 Tax Law?

And how would Apple determine if my mother-in-law’s monthly payments are for her share of the rent or if she’s paying me for room and board and I need to get a 1099?

What would qualify as a business transaction?

i mean hypothetically you wouldn’t have to report capital gains on your stamp collection lol. The IRS isn’t going to audit someone who exceeded the $600 threshold… too many people will exceed that on their 1099K. It’s an unenforceable law that only applies to those who are ethical enough to abide by it.

This is not accurate…selling personal items that are a peer to peer transaction is not a taxable transaction as the original transaction was already taxed. For example … if I buy a Tv at Best Buy I’m taxed. If I resell that same TV the IRS cannot tax a second time.

Please read up on the new tax law as this is BUSINESS(commercial) transactions that generate $600 or more in a year will get a 1099 to pay taxes at the end of the year. Now if you have a “side hustle” where let’s say you perform a service (barber, hair stylist, mechanic, etc.) and do not have your business registered and ask for payment for your service to be on a peer to peer platform. It will not be initially taxed or even flagged as a business by the IRS. However, you run the risk of audit as now the IRS will look closely at high volume high frequency peer to peer transactions on non business/commercial accounts. For example having a CashApp personal acct and getting daily payments of a frequent nature instead of switching to a CashApp business acct.

very dangerous to play games with the IRS. They always get their money!

Pretty much any transaction for which there is an exchange of goods, services, or money. Paying back a family member or sending your roommate rent would not count. Selling your stamp collection would.

It's best to work with your tax adviser and seek professional guidance as nobody here can give you such advise.

1. You can use Apple Cash to pay your card but you'll generally just pay directly from your bank. For example. If your bill is $100 and you have $20 in Apple Cash. You'll just go to your card to pay and can elect to pay $100 from your bank or $80 from the bank and apply your Apple Cash balance. See this for detail: https://support.apple.com/en-us/HT209226. Nothing is taxed, it's just you transferring your own money.
2. Taxed by the Apple Cash somehow? No. If you're referring to the new IRS reporting threshold, generally payments made to family as reimbursement, gifts, etc. are not reportable. But, your rental income, as always, certainly is reportable income. Nobody here can provide tax advice so it's best to consult a tax professional for your individual situation regarding income taxes.

That's why folks need to contact tax professionals and not get their advice from these boards.

Selling a stamp collection could cause a capital gain -- which would be reported differently but still show up in a 1099-K if money is collected through peer-to-peer -- and selling a TV for more than you paid for it (unlikely but possible with other items) would cause the difference to be reportable as income (sales tax is state collected and not relevant for the example). All of your money from side hustles is taxable (always has been but now the reporting threshold has been lowered).

The bottom line. Folks need to keep good records. And, they need to speak to tax professionals.

I have 2 scenarios I'm confused about.

1 - to pay my apple credit card i transfer money from the bank to Apple Cash and then Apple Cash to the apple Credit card.... I just like to see the balance clear right away ! Will I be taxed?

2 My mother in law pays us food and rent $ and sends through Apple Cash ,,, Will I be taxed?

Yes, all peer-to-peer networks will be required to report and send you a 1099-K.

While peer to peer networks will be required to send a 1099K …those transactions have to qualify as business transactions.

If the mother-in-law is paying her portion of the household rent and food then it is not taxable. However if you are charging her room and board that would be taxable

They won’t. They’ll send you the tax form. You’ll take it from there