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Thread: Why does Paypal want my Social Security number?

  1. #1
    Heroic Warrior Dr Kain's Avatar
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    Why does Paypal want my Social Security number?

    I got a message from Paypal stating they want my social security number for tax reasons. Does this sound odd to anyone? I have never needed a number in the 10 years I have used Paypal and I am not a business.
    Can someone PM me the US number for Matty? I want to talk to someone who might has a clue of what is going on.

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  2. #2
    Mistress of the Whip! Divia's Avatar
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    Hmm, yes this does sound odd. And its even odder cause i recently read an article that stated less and less businesses should be asking for your SS number.

    Don't give it whatever you do. Is there a number you can use to call them?
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    Master of Gardening MOTU_Maniac's Avatar
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    Quote Originally Posted by Dr Kain View Post
    I got a message from Paypal stating they want my social security number for tax reasons. Does this sound odd to anyone? I have never needed a number in the 10 years I have used Paypal and I am not a business.
    There are new tax laws with selling online. If they have asked for your SSN then they believe you will go over the $20,000 and 200 item per year threshold limits. IF you don't give it to them then they will block you from using PayPal.
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  4. #4
    Mistress of the Whip! Divia's Avatar
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    Quote Originally Posted by MOTU_Maniac View Post
    There are new tax laws with selling online. If they have asked for your SSN then they believe you will go over the $20,000 and 200 item per year threshold limits. IF you don't give it to them then they will block you from using PayPal.
    Interesting. Well then I guess the question is do you fit into that category?
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  5. #5
    Master of Gardening MOTU_Maniac's Avatar
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    And it doesn't mean that you HAVE hit those limits. It just means they think you might.

    Let's say you had a very busy month this month then they might take that total and multiply x12 months and assume you will hit them. So, they ask for your SSN because IF you hit those limits they are required to turn your earnings over to the IRS for tax purposes.
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    Heroic Warrior Dr Kain's Avatar
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    Ha! If I made anywhere close to $20,000 this year, I would be amazed. I'd say I probably made $5000-6000 tops this year, and even that is pushing it. Most of the transactions I did were in the $20-50 range throughout the year.

    Don't see what this matters though. Again, I am not a business, and thus, I have no reason to be treated as one.
    Can someone PM me the US number for Matty? I want to talk to someone who might has a clue of what is going on.

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  7. #7
    Heroic Warrior
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    No I would say it is definitely a SPOOF email trying to steal your identity. PayPal or any other reputable website would never ask for personal info via email. Don't send anything. Forward the email to spoof@paypal( I think) and they will confirm.
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    Super Powered Mod! markatisu's Avatar
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    They do ask for it if you hit the threshold that MOTU Maniac says, does not matter if you are a business or not the IRS considers those limits taxable income. Don't agree with it, Don't like then call your Congress person and complain as it was something the IRS and Paypal reached in agreement to try and make sure people reported income. Before that happened many people who "were not" a business evaded paying taxes since Paypal is unregulated.

    You can opt not to do it but then IRS will also be notified that you refused and you risk an audit, so just like the Paypal claim thread Dr Kain you can either play by their rules or you can get out and deal with money order/cash only sales. Its not really open for negotiation or interpretation if you want to ever use paypal or eBay. I know a number of people who have stopped using eBay and Paypal after they were required to give their info, they do money order only now.

    Now with that said EVERYTHING in regards to this is done online, securely through their site. They will never ask you to put that information in an email or any place outside the designated https secured area on the paypal account page. All it does is allow them to send the Tax Form to the IRS with your total paypal payments accepted.
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    Always Hungry.... Megalodon's Avatar
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    Ok something like that is haoppening to me and I don't sell at all on E-Bay just buy and I think this is crap because I just was a victim of identity theft last month and I am not giving up ANY personal information but I still want to use paypal (I have to with E-Bay and others) so what do I do?? I don't have a bank account anymore so I use Green.dot to load funds on my paypal account

    So do I explain that to them because they pretty much don't give two craps most of the time...

    And once again I am NOT a seller they said it was "random"

  10. #10
    Super Powered Mod! markatisu's Avatar
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    Quote Originally Posted by Megalodon View Post
    Ok something like that is haoppening to me and I don't sell at all on E-Bay just buy and I think this is crap because I just was a victim of identity theft last month and I am not giving up ANY personal information but I still want to use paypal (I have to with E-Bay and others) so what do I do?? I don't have a bank account anymore so I use Green.dot to load funds on my paypal account

    So do I explain that to them because they pretty much don't give two craps most of the time...

    And once again I am NOT a seller they said it was "random"
    Well if you are making no money I do not see why you would need to give up that info, the IRS notice won't apply for you because they can't tax you on buying items as its not income

    I would tell them no and see what happens
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    plastic vice Phil.Pastel's Avatar
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    Quote Originally Posted by markatisu View Post
    Well if you are making no money I do not see why you would need to give up that info, the IRS notice won't apply for you because they can't tax you on buying items as its not income

    I would tell them no and see what happens

    Is there a specified amount that you have to reach before you report sales on your income tax? I typically sell a few hundred dollars of stuff on ebay per year. Profit is pretty minimal, sometimes nonexistant. I've never bothered reporting it because there's not really anything there to report.

  12. #12
    Super Powered Mod! markatisu's Avatar
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    Quote Originally Posted by Phil.Pastel View Post
    Is there a specified amount that you have to reach before you report sales on your income tax? I typically sell a few hundred dollars of stuff on ebay per year. Profit is pretty minimal, sometimes nonexistant. I've never bothered reporting it because there's not really anything there to report.
    $20,000 or 200 transactions, their reasoning is both of those are good indicators of more than just casual use.
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    plastic vice Phil.Pastel's Avatar
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    Quote Originally Posted by markatisu View Post
    $20,000 or 200 transactions, their reasoning is both of those are good indicators of more than just casual use.

    Hmmmm... Well, I do rack up pretty many transactions over the course of the year, but 98% of that is as a buyer. As far as $20,000, I wish

    A lot of times, I just sell stuff at cost that I don't want anymore. I just sold off Dogpound, Fish face, and metalhead for $30. I probably lost a few dollars counting seller's fees and gas
    Last edited by Phil.Pastel; December 18, 2012 at 10:02pm.

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    Super Powered Mod! markatisu's Avatar
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    Yeah I hit $20,000 a long time ago, I only wish that was profit

    Sadly for as crappy as paypal is its still one of the easiest ways to accept a credit card for online business, so I was forced to submit to their Tax regulations
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    Heroic Warrior Piccolo Daimaoh's Avatar
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    I have the same thing happening to me right now. They want a SSN or an EIN. My uncles are accountants and they said never to give a SSN. They said to go to the IRS website and get an EIN and give that to Paypal. They have been asking for it since August and threaten to limit my Paypal account but as of yet it has not happened.

    I have been selling items on Ebay since June and have been making 200.00 to 400.00 a month since then. I am selling collectibles and magazines I have bought for my own personal collection for the past 18 years. I have been paying the storage on them since 2004 so I should not have to pay any taxes on them since I paid taxes to buy them and pay to store them but it is still is a bit of an inconvenience.
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    Heroic Warrior Dr Kain's Avatar
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    Yeah, I've got nothing to worry about. Like I said, I am not even close to $20,000 for the year from Paypal and I only have 165 transactions where I received money.
    Can someone PM me the US number for Matty? I want to talk to someone who might has a clue of what is going on.

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  17. #17
    Master of Gardening MOTU_Maniac's Avatar
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    Quote Originally Posted by Dr Kain View Post
    Yeah, I've got nothing to worry about. Like I said, I am not even close to $20,000 for the year from Paypal and I only have 165 transactions where I received money.
    Also, it's $20,000 AND 200 transactions, not $20,000 OR 200 transactions. So, you have to hit BOTH thresholds or they shouldn't turn you into the IRS.
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  18. #18
    Heroic Warrior Dr Kain's Avatar
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    Quote Originally Posted by MOTU_Maniac View Post
    Also, it's $20,000 AND 200 transactions, not $20,000 OR 200 transactions. So, you have to hit BOTH thresholds or they shouldn't turn you into the IRS.
    Well that works too. That is odd though because I still do not understand why they would have to send anything to the IRS to begin with. It isn't like there is any way to pay taxes on what you make online, let alone charge taxes. Plus, the point of buying online is because there are no taxes (unless you are MattyCollector, the only people I have ever been charged tax from).
    Can someone PM me the US number for Matty? I want to talk to someone who might has a clue of what is going on.

    Evil will always triumph because good is dumb.

  19. #19
    plastic vice Phil.Pastel's Avatar
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    Quote Originally Posted by Dr Kain View Post
    Well that works too. That is odd though because I still do not understand why they would have to send anything to the IRS to begin with. It isn't like there is any way to pay taxes on what you make online, let alone charge taxes. Plus, the point of buying online is because there are no taxes (unless you are MattyCollector, the only people I have ever been charged tax from).

    I first thought that MattyCollector must have gave you up to the fed after you bought
    those 50 Sir Laser Lots, but then I remembered they don't accept PayPal

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    Super Powered Mod! markatisu's Avatar
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    Quote Originally Posted by Dr Kain View Post
    Well that works too. That is odd though because I still do not understand why they would have to send anything to the IRS to begin with. It isn't like there is any way to pay taxes on what you make online, let alone charge taxes. Plus, the point of buying online is because there are no taxes (unless you are MattyCollector, the only people I have ever been charged tax from).
    Well that is because you are ignoring that at its core that is illegal, there has been numerous discussions at the legal level on how buying on the internet violates the IRS tax collection because neither the buyer not the seller pays tax. When you buy something from Amazon.com you are basically breaking the law, its just that states cannot really do anything about it at the moment. They could "technically" force Amazon.com to hand over their customer records and then hit you with a tax bill, that is perfectly legal btw.

    So yeah we should all be paying tax, we just benefit from the fact that they have not formally created an internet tax law.

    This is just the first step in that direction, there are several states that have laws pending that would force you to pay tax on everything you sell or buy regardless of whether or not the state you are buying from is non taxable.
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    plastic vice Phil.Pastel's Avatar
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    Quote Originally Posted by markatisu View Post
    Well that is because you are ignoring that at its core that is illegal, there has been numerous discussions at the legal level on how buying on the internet violates the IRS tax collection because neither the buyer not the seller pays tax. When you buy something from Amazon.com you are basically breaking the law, its just that states cannot really do anything about it at the moment. They could "technically" force Amazon.com to hand over their customer records and then hit you with a tax bill, that is perfectly legal btw.

    So yeah we should all be paying tax, we just benefit from the fact that they have not formally created an internet tax law.
    Not sure if I agree with that. After all, you don't pay any taxes if you buy something at a flea market or a yard sale. Some things just can't be properly regulated. Any attempts to do so would be futile.

  22. #22
    Wise Old Trollan Uncle Montork's Avatar
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    Quote Originally Posted by Phil.Pastel View Post
    Not sure if I agree with that. After all, you don't pay any taxes if you buy something at a flea market or a yard sale.
    Give it time...
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  23. #23
    Master of Gardening MOTU_Maniac's Avatar
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    I always have to pay tax when I purchase on Amazon because many of the main shipping centers are here in Kentucky. I sometimes pay on ebay. Guess it depends on the seller.

    The world is changing and it's only a matter of time before we are taxed on the air we breathe. lol.
    Last edited by MOTU_Maniac; December 19, 2012 at 02:56pm.
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  24. #24
    Super Powered Mod! markatisu's Avatar
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    Quote Originally Posted by Phil.Pastel View Post
    Not sure if I agree with that. After all, you don't pay any taxes if you buy something at a flea market or a yard sale. Some things just can't be properly regulated. Any attempts to do so would be futile.
    You also don't usually pay with CC at a flea market or yard sale. Cash and Money orders/Check are virtually impossible to track from a tax standpoint as they can go unrecorded (unless the person depositing the checks is doing a lot of business), so you can't expect tax regulation on something you have no evidence of happening.

    But we are talking about online commerce which is what Paypal is, if Dr Kain wants to go to cash only sales then he wont have to worry about this issue but he is not he is using eBay and Paypal aka ecommerce.

    You don't have to agree with it, I am sure a lot of us don't agree with the IRS
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  25. #25
    Heroic Warrior Piccolo Daimaoh's Avatar
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    Quote Originally Posted by markatisu View Post
    Well that is because you are ignoring that at its core that is illegal, there has been numerous discussions at the legal level on how buying on the internet violates the IRS tax collection because neither the buyer not the seller pays tax. When you buy something from Amazon.com you are basically breaking the law, its just that states cannot really do anything about it at the moment. They could "technically" force Amazon.com to hand over their customer records and then hit you with a tax bill, that is perfectly legal btw.

    So yeah we should all be paying tax, we just benefit from the fact that they have not formally created an internet tax law.

    This is just the first step in that direction, there are several states that have laws pending that would force you to pay tax on everything you sell or buy regardless of whether or not the state you are buying from is non taxable.
    Just like MOTU_Maniac, I'm in PA and I had to pay taxes on all of my Amazon purchases and if I purchase an item on Ebay from someone who lives in PA I have to pay taxes on the purchase.

    BUT, I guess this is a way for Paypal to help keep things nice and legal yet I always feel like Paypal and Ebay are taking such a large percentage of my sales it should be criminal.
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