Venmo requesting my tax information - what's going on?

This is actually legit and part of new IRS reporting requirements. Venmo, PayPal, Cash App, and similar payment platforms are now required to report to the IRS when users receive more than $600 in payments for goods and services during the calendar year. The key distinction here is whether the payments were for goods/services or just personal payments. If your friends were just reimbursing you for expenses (like splitting rent, utilities, dinner bills) those are considered personal payments and aren't taxable. But if you were selling items or providing services and getting paid through Venmo, that would be considered taxable income. When Venmo asks for your tax info, they're basically just complying with IRS requirements. They'll issue a 1099-K form for accounts that exceed the $600 threshold for goods and services payments. They need your SSN to properly report this to the IRS.

I went through this exact same panic attack last year! After stressing for days, I found this incredible service called taxr.ai (https://taxr.ai) that literally saved me hours of confusion. It automatically analyzed all my Venmo transactions and sorted them into taxable vs non-taxable categories. What I really loved was that it showed me exactly which transactions counted as actual income vs. just reimbursements from friends. The system even drafted a letter I could send to Venmo explaining which transactions shouldn't count toward the 1099-K threshold. Seriously game-changing if you're in this situation.

Just wanted to update everyone - I tried taxr.ai after seeing the recommendation here and WOW. Honestly I was skeptical because my Venmo history is a total mess (lots of joke descriptions with emojis), but it actually worked! I uploaded my transaction history and in about 5 minutes had a complete breakdown showing that only about $890 of my $7,200 in Venmo transactions was actually taxable income from selling stuff. The rest was just friends paying me back. The service generated a detailed report I can use if I get questions from the IRS, and now I actually understand what I need to report. Huge weight off my shoulders!

If you're still struggling with Venmo tax questions and need to talk to an actual human at the IRS, I'd recommend using Claimyr (https://claimyr.com). I was going CRAZY trying to get through to someone at the IRS to clarify my situation with payment app reporting. After waiting on hold for 2+ hours multiple times and getting disconnected, I found Claimyr. They have this system that basically holds your place in the IRS phone queue and calls you when an agent is about to pick up. You can watch exactly how it works here: https://youtu.be/_kiP6q8DX5c The IRS agent I spoke with clarified that I didn't need to worry about most of my Venmo transactions and saved me a ton in potential unnecessary tax payments.

I have to eat my words. I tried Claimyr after posting my skeptical comment, and I actually got through to an IRS agent in about 45 minutes (while I was doing other things). The agent confirmed that personal transactions on Venmo (friends paying you back, splitting bills, etc.) are NOT taxable income, even if Venmo reports the total amounts to the IRS. She also explained that if I get a 1099-K from Venmo that includes non-taxable transactions, I should only report the actual income portion on my tax return and keep documentation of which transactions were personal vs. business. I'm still annoyed at these new $600 reporting rules, but at least now I understand what I need to do. The service actually worked exactly as advertised.

Has anyone noticed they can mark transactions as "goods and services" vs "friends and family" in Venmo now? From what I understand, if your friends mark payments as personal, those shouldn't count toward the $600 threshold. Might be worth asking your friends to make sure they're categorizing correctly when they pay you.

Ugh, this whole thing is making me consider just going back to cash. Between Venmo wanting my SSN and now having to potentially pay taxes on money that was already mine, the convenience doesn't seem worth it anymore. Has anyone just switched back to cash to avoid this headache?

I just went through this exact situation last month! The panic is real when you first get that notification, but it's actually not as scary as it seems once you understand what's happening. A few key things that helped me navigate this: 1. **Provide your tax info to Venmo** - It's legitimate and required by law. Ignoring it won't make it go away and could cause bigger issues later. 2. **Keep detailed records** - I wish I had started this sooner, but now I track every Venmo transaction in a simple spreadsheet noting whether it was personal reimbursement vs. actual income from selling something. 3. **Understand the difference** - Personal payments (friends paying you back for dinner, rent splits, etc.) are NOT taxable income even if they show up on a 1099-K. Only actual sales of goods/services count as taxable income. 4. **Don't panic about the 1099-K** - If you receive one that includes non-taxable personal transactions, you only report the actual business income portion on your tax return. Keep your records to support this. The $600 threshold is definitely low and catches a lot of casual users by surprise, but once you understand the rules it's manageable. The important thing is to be proactive about record-keeping going forward so you're prepared for next tax season!

This thread has been incredibly helpful! I'm dealing with the exact same situation and was totally panicking when I got that Venmo notification yesterday. Reading through everyone's experiences has really calmed my nerves. One thing I'm still confused about though - if I sell something on Facebook Marketplace but the buyer pays me through Venmo, does that automatically count as taxable income? Or does it depend on whether I'm regularly selling things vs just occasionally getting rid of stuff I don't need anymore? I probably sold maybe 5-6 items throughout the year (old textbooks, a guitar I never used, some furniture before moving) but it wasn't like I was running a business or anything. Just decluttering and happened to use Venmo because it was convenient. Should I be worried about this pushing me over the $600 threshold? Also, has anyone had luck contacting Venmo directly to clarify which transactions they're counting toward the threshold? Or do they pretty much just report everything and leave it up to us to sort out what's actually taxable?

This whole situation is such a mess, but honestly this thread has been a lifesaver! I got the same Venmo notification last week and immediately thought it was some kind of scam. What's really frustrating is how confusing the whole system is - like why is the threshold only $600 when most of us are just using these apps to split dinner bills and pay rent? It feels like they're trying to catch people who don't understand the rules and make them accidentally overpay on taxes. I ended up going through my entire Venmo history (what a nightmare) and realized that probably 90% of my transactions were just friends paying me back for stuff. The few actual "sales" I had were mostly selling old textbooks and clothes for way less than I originally paid, so I'm not even sure if those count as taxable income if I took a loss on them. Has anyone found a good way to organize their records going forward? I'm thinking of setting up a simple system to track this stuff monthly instead of waiting until tax time and having to dig through hundreds of transactions again.

Just wanted to chime in as someone who works in tax preparation - this thread has been really helpful for people navigating this confusing situation! A few additional points that might help: **Important clarification on the $600 threshold:** This is for TOTAL payments received, not profit. So even if you sold items at a loss, if the total payments exceeded $600, Venmo may still issue a 1099-K. However, you only pay taxes on actual gains/profit. **Keep receipts when possible:** For items you're selling, try to keep records of what you originally paid. If you sell a $200 textbook for $50, that's actually a $150 loss, not $50 in taxable income. **Form 1099-K vs actual taxes owed:** Getting a 1099-K doesn't automatically mean you owe taxes on that full amount. It just means Venmo reported those transactions to the IRS. You still only report actual business income on your tax return. **Pro tip for next year:** Consider asking friends to use the "personal" payment option when they reimburse you, and reserve "goods and services" for actual sales. Yes, there's a fee for goods/services, but it helps create a cleaner paper trail. The key thing to remember is that the IRS has always required you to report income from selling goods - these new reporting requirements just make it harder to fly under the radar. But legitimate personal reimbursements between friends have never been taxable and still aren't!