14 One thing nobody's mentioned - make sure you're properly licensed and insured for a home laundry business! My sister got hit with fines because she didn't have the right permits. Also affects your tax situation because those permit fees and insurance premiums are deductible business expenses.

Great discussion everyone! As someone who's been running a small home-based service business for a few years, I can definitely relate to the confusion around deductions. One thing I'd add is to consider setting up a separate business bank account if you haven't already - it makes tracking business expenses so much easier come tax time. Also, don't forget about deducting your business insurance premiums, any professional memberships or subscriptions related to your laundry business, and even mileage for business-related trips (like picking up supplies or meeting clients). These smaller deductions can really add up over the year. Keep receipts for everything and consider using a simple spreadsheet or accounting app to track expenses monthly rather than scrambling at tax time. One last tip - if you're doing laundry for other businesses, make sure you're issuing proper invoices and keeping copies. The IRS loves to see that paper trail for business-to-business transactions.

I'm glad you found this community thread - this PayPal 1099-K situation is becoming incredibly common and causing a lot of unnecessary stress for people! You're absolutely doing the right thing by asking questions before just panicking and reporting gift money as income. One thing I'd add that I haven't seen mentioned yet - if your parents sent the money through PayPal's "Friends and Family" option, that actually helps support your case that these were personal gifts rather than business transactions. PayPal typically issues 1099-Ks based on total transaction volume, but the transaction type can be relevant context. Also, since you mentioned this was for grad school expenses, you might want to check if any of these funds were used for qualified education expenses that could give you other tax benefits (like the American Opportunity Tax Credit or Lifetime Learning Credit). Even though the gift money itself isn't taxable to you, you might still be able to claim education credits for how you spent it. The documentation everyone mentioned is key - keep those records organized in one place. If the IRS ever does ask questions, having a clear paper trail showing family support for education expenses makes this pretty straightforward to explain.

Just wanted to chime in as someone who dealt with a very similar situation! I received about $28,000 in PayPal transfers from my parents during my master's program and also got hit with that dreaded 1099-K form. I completely understand the panic you're feeling right now. Here's what I learned after going through this process: The 1099-K is basically just PayPal covering themselves by reporting transaction volumes over $600 (the new threshold). It doesn't mean the IRS automatically considers this taxable income - they know that payment apps are used for all kinds of personal transactions now. The most important thing is to have your story straight and documented. I kept a simple spreadsheet showing each transfer amount, date, and what I used it for (rent, groceries, tuition, etc.). I also saved screenshots of text conversations with my parents that clearly showed these were gifts for school support, not payments for services or business income. When I filed my taxes, I had to reconcile the 1099-K amount but was able to properly categorize the family gifts as non-taxable. My tax preparer said this is becoming extremely routine now - they handle dozens of these cases every tax season. Don't let this stress you out too much! You're handling it exactly right by asking questions and gathering documentation. The IRS isn't trying to tax genuine family support for education - they just need the paper trail to be clear if they ever review your return.

I went through this exact same worry when I started collecting roommate payments through apps! The anxiety about potential tax issues was keeping me up at night, especially with all the news about new payment app reporting rules. Here's what I learned after doing a ton of research and talking to a tax professional: you're absolutely in the clear. These payments are classic reimbursements, not income. The IRS distinguishes between money you earn (taxable) and money that repays you for expenses you covered (not taxable). Since you're just being reimbursed for your roommates' actual share of rent and utilities, there's no taxable event happening. The key things that keep you safe: - You're not charging more than the actual expenses - You're not making any profit from this arrangement - These are legitimate shared living costs, not payments for services I'd recommend keeping a simple record of your monthly bills and what each person pays, just for your own peace of mind. Also make sure your roommates send payments as "personal" rather than "business" transactions in the apps. The new $600 reporting threshold everyone talks about only applies to business transactions anyway, so even if somehow these payments got flagged, they wouldn't meet the criteria since they're personal reimbursements. You're handling a totally normal roommate situation in a completely legitimate way!

I totally understand your anxiety about this situation! As someone who's been through similar roommate payment scenarios, I can assure you that you're worrying about a non-issue here. The bottom line is simple: when your roommates send you money through payment apps to cover their share of rent and utilities, that's reimbursement, not income. You're not making any profit - you're just being repaid for expenses you covered on their behalf. This is true whether it's $50 or $5,000 per month. Here's what you should focus on to keep everything clean: **Payment categorization**: Make sure your roommates always select "friends/family" or "personal" when sending payments, never "goods/services" or business options. **Clear documentation**: Have them include notes like "March rent" or "utilities" in the payment memos. This creates an obvious paper trail. **Simple record keeping**: Keep a basic spreadsheet showing your monthly expenses and each person's share, plus save copies of your lease and utility bills. The new payment app reporting requirements that have everyone worried are specifically targeting unreported business income - people selling products or services. Roommates splitting household expenses doesn't fall into this category at all. You're handling a completely normal living situation in the most straightforward way possible. Don't let the tax anxiety stress you out over something that's perfectly legitimate!

Quick note - I'm an LLC with almost the exact same situation selling specialty foods. My accountant told me to treat promotional samples as "marketing samples" not as COGS, and to track them separately in our inventory system from day one. We literally mark them as "promotional inventory" when they come in. This makes tax time MUCH easier and creates a clear paper trail. Also, don't forget you can deduct the shipping costs associated with sending those promotional items separately as well! We send sample packs to food bloggers and that shipping adds up.

Just wanted to add another perspective as someone who's been through several IRS audits with my small manufacturing business. One thing I learned the hard way is to also track the fair market value of your promotional items at the time you give them away, not just your cost basis. For tax purposes, you can deduct your cost ($12.75 per unit), but if you're ever audited, the IRS might want to see that you properly valued the promotional gifts. If your retail price is significantly higher than your cost, they could potentially argue about the true value of what you gave away. Also, create a simple promotional log with columns for: date given, recipient name/business, quantity, cost per unit, retail value, and business purpose. This one document can save you hours of headaches if the IRS ever questions your marketing deductions. I keep mine in a simple Excel sheet and update it immediately after each promotional giveaway. The shipping costs you mentioned definitely count as marketing expenses since they're directly related to your promotional activities. Just keep those receipts with your promotional documentation.

I'm in the exact same situation! I banked with SunTrust for years and completely forgot about the routing number change when I filed in early February. I've been refreshing my bank account every few hours like it's going to magically make my refund appear faster. After reading everyone's experiences here, I'm feeling so much more confident that everything will work out fine. It sounds like Truist really has their act together with the automatic forwarding system during this transition period. For anyone else stressing about this - I called Truist yesterday and the representative told me that they're processing thousands of these redirected tax refunds daily without any issues. She said as long as your account number is correct, the routing number redirect happens automatically on their end. One tip that helped calm my nerves: I set up account alerts in the Truist mobile app so I'll get notified immediately when any deposit hits my account. That way I'm not constantly checking manually. Tax season is stressful enough without adding unnecessary banking anxiety to the mix!

I just went through this exact same situation and wanted to share my experience to hopefully ease some worries! I filed my 2023 return on February 8th using my old SunTrust routing number because I completely spaced on the merger changes. My refund of $2,156 was deposited into my Truist account on February 23rd without any issues whatsoever. It showed up as a normal direct deposit - no delays, no complications, just processed like any other year. The automatic forwarding system worked perfectly. What really helped my peace of mind was logging into the Truist online banking and updating my direct deposit information for next year. Under the account details section, you can clearly see both the old and new routing numbers, and there's even a note explaining that both will work through the end of 2024. For anyone still worried: the bank merger teams have been planning for tax season for months. They know this is their biggest test of the forwarding system, and from what I can tell, they've got it handled. Your refund will find its way to your account just fine!