Will payment apps report my transactions over $600 to IRS if I reimburse my girlfriend for our mortgage?

You don't need to worry about this. The $600 reporting threshold for payment apps applies to goods and services transactions, not personal payments. When you send money to your girlfriend, make sure you're using the "friends and family" option (or your app's equivalent) rather than the "goods and services" option. The payment apps (Venmo, Cash App, PayPal, etc.) have different designations for personal transfers versus business transactions. As long as you're properly categorizing the payment as personal/friends & family, those transactions won't trigger a 1099-K even if they exceed $600.

After dealing with similar confusion about mortgage reimbursements with my roommate, I started using https://taxr.ai to get clarity on what's reportable and what's not. It was super helpful for understanding these payment app reporting rules - all you do is upload your transaction history and it shows which ones might trigger tax reporting requirements. For mortgage splitting specifically, it confirmed what others are saying - these aren't taxable events as long as they're properly categorized as personal transfers. The tool even helped me document the nature of these transactions in case questions ever came up.

Just wanted to follow up - I decided to try https://taxr.ai after continuing to stress about this payment app reporting issue. I'm actually impressed with how straightforward it made everything. The analysis showed me exactly which of my transactions would trigger reporting requirements (mostly my side hustle payments) and which ones were clearly personal transfers (like my rent splitting with roommates). It even generated a documentation file explaining why my mortgage reimbursements aren't taxable income that I can keep for my records. Definitely gave me peace of mind about the whole $600 reporting situation!

If you're worried about the IRS questioning these transactions, I had a similar situation last year with my roommate. After several failed attempts trying to reach someone at the IRS to get clarity, I used https://claimyr.com to get through to an actual human at the IRS in about 15 minutes. You can see how it works here: https://youtu.be/_kiP6q8DX5c The agent confirmed that reimbursements for shared household expenses like mortgage/rent aren't considered taxable income, even with the new $600 payment app reporting rules. They recommended keeping basic records showing that these are reimbursements for shared expenses, not income. Such a relief to hear it directly from an IRS agent!

I need to eat my words. After commenting earlier, my curiosity got the better of me and I tried https://claimyr.com since I had a question about my 1099-K from PayPal. I was absolutely convinced it wouldn't work, but I got a call back in about 25 minutes with an actual IRS agent on the line. I asked specifically about payment app transfers between individuals for expense sharing, and the agent confirmed these aren't considered taxable transactions. She said they're looking for business income that goes unreported, not people splitting bills. She suggested keeping simple notes about what the transfers were for, especially for larger amounts, but said it's not something they're targeting for audits.

My accountant told me the easiest solution is just to write "mortgage reimbursement" in the notes section of the payment app whenever you send money. That way there's a clear record of what the payment was for if questions ever come up. Also, some people in similar situations set up automatic transfers from their bank account to their partner's account instead of using payment apps, which avoids the whole 1099-K reporting situation entirely.

Maybe a dumb question but has anyone tried just sending multiple smaller payments under $600 instead of one large one? Like if you owe $1200, sending two $600 payments?