Read the first two paragraphs here > http://www.apple.com/legal/itunes/us/terms.html#GIFTS
Just so you are aware, many users have reported issues trying to use a PayPal account with iTunes.
An alternative, if you do not want to use a credit or debit card, you can purchase iTunes gift cards which can be redeemed for iTunes media.
You don't have to do that. If you purchase an iTunes gift card, go to the iTunes Store. Select Redeem under Quick Links on the right side of the iTunes Store window.
Very easy to do. Choose your iTunes Gift Card - Apple Store (U.S.)
How can I check the balance of my Apple Gift Card?
Call 1-888-320-3301 and follow the instructions. You can also see your balance by visiting the account area of the online Apple Store online.