Congressional Democrats slipped a last-minute tax provision into the pandemic relief bill that may complicate how millions of gig economy workers report their incomes.
The measure, the final version of which is expected to pass this week, would not increase the tax rate for such workers, and experts describe it as a sensible move to simplify rules. However, they also acknowledge tighter accounting of revenue from third-party, app-based vendors, such as Uber, Airbnb and DoorDash, could force some to pay more taxes by having to document additional income.
The addition is intended to offset some costs of the massive $1.9 trillion American Rescue Act, but itâs estimated to garner just $8.4 billion over 10 years.
Walmart Marketplace (NYSE: WMT) and even
Amazon (NASDAQ: AMZN) could find themselves with tax issues in 2022 thanks to a change in Internal Revenue Service tax codes contained within the American Rescue Plan Act of 2021.
The $1.9 trillion COVID relief bill that just passed the U.S. House and Senate and is expected to be signed into law by President Joe Biden by this weekend amends Section 6050W of the IRS code to require reporting for any transactions that exceed $600 in gross sales through a 1099-K form.
This change means not only are workers required to claim this income on their taxes (as currently required), but any business that pays them, such as