Paypal made a mistake on my 1099-k, seeking advice on how to fix!

[sgong33]

A bit desperate here as paypal customer service has been no help.

The gist of my problem is paypal reported a 1099-k (31 transactions for $4,424) to the IRS for 2015. They reported this because they accidentally tagged income from my 501c3 business account to my personal SSN. I got the 501c3 1099k fixed however the IRS is still now saying i owe taxes/self employment on my personal 1099k (that never should have been sent but was because of the mistake on my 501c3). I called the IRS and explained that the money from 2015 was from selling used items when we moved homes but they said I still need to report it. I also called PayPal looking for guidance and they said they would "zero out my 1099k for 2015" and send it to me via mail... well sure enough a week has passed and they sent me the wrong 1099k and im going in circles trying to get the new form.

So my questions are:

1. Do I owe taxes on the sale of my used personal goods in 2015/How do i report and file it? (the IRS is currently considering it capital gains and self employment). I thought all i need to do was write a letter to the IRS stating that these were garage sale items.

2. Will a zeroed out 1099k form from paypal even help? Since they already reported that money to the IRS, do i have to file/explain? or do i wait for the zeroed out form and just tell the IRS "it was a mistake, heres the new 1099k showing zero."

There is a serious disconnect with paypal customer service. Their system of "you cant speak to the person who can help you, but ill put in a ticket and have a nice day" creates a serious gap in getting the proper help provided.

[bgswansonlocc]

This has happened to me as well but I don’t have any business and I honestly don’t know what to do here. They sent a 1099k to the irs stating a grossly incorrect figure of $19,658. I counted my transactions for that year to be less then $1100! My question is what formula do they use to come up with the figure they forward to the IRS? Is it transactions alone? Where you ever able to get answers as I too have found PayPal customer service to be extremely unhelpful as the The revenue is preparing to put me in default as I have refused to acknowledge this false claim. Is there anyone who knows of how to proceed?

[Teslafan101]

have you received payment via goods and services which should be friend and family?

[Teslafan101]

the figures in 1099k IS GROSS,it does not exclude sales tax you collected,returns,chargebacks, 

[bgswansonlocc]

To answer your other question no I had not received any funds from friends. In fact I have learned this has gone horribly south. It turns out an additional account was opened under my credentials in 2012 that I never had any knowledge. This additional account is the source of this $19,658 and 377 transactions that I had no knowledge of. Thus far I have traced this account after finally receiving a copy of my wage and income transcript through the IRS as PayPal has been uncooperative In providing me with the 1099-k they sent until I confronted them with the knowledge of this account. I lived in Texas at the time of this activity but this account had an address associated with it in Union City California with a specific address that shows up as a UPS store. I also don’t recognize the email address associated with that account. As I said before PayPal has changed their story and has been non existent in helping me resolve this issue and refuses to answer how they allow two accounts under the same name and social security number with home addresses 3000 miles apart at the same time and that not raise a red flag in their system. They flat out refuse to provide any further information including what identification was used to verify the identity on the other account. I’m willing to bet the identification used to verify that account is not a match as I have never misplaced any of my identification or social security card. They have implied that somehow this other person is me and refuse to admit they are at fault for anything. As I prepare for the daunting legal battle I’m in now I think it’s important to mention that I honestly very well could have been intentionally done on their part based on the many different stories I get every time I get them on the phone and based on the feedback I get from the IRS along with the attorneys I have consulted. I think it’s ironic Facebook is facing a heavy fine for breach data because if I have any say in the matter, PayPal will not be far behind. To be clear, this is a very dangerous company. The level of incompetence I experience when speaking with these so-called customer service agents is staggering... and the sound like the live in America so I can’t even give them the excuse of being outsourced. Just a flat out criminal organization to be honest. I read in another thread where people doubted a consumer with a description similar to this and I’ll just say that, it’s easy to be condescending when it happens to someone else.

[rainbomg]

How did you find that info out? I’m being taxed $60k that is on the $120k in payments PayPal sent under my name but clearly from a different PayPal account bc mine shows that I actually only used it for a total of $5 that year. If it’s not on my account and I never received any payments how can I prove to the irs that something I am blind to isn’t right? You can’t prove a negative! Omg this is so stressful 

[bgswansonlocc]

No payments via goods and services. My known account at that time had 7 transactions for $726. I am not a full time PayPal seller. The only reason I was on PayPal that much that year was I was transitioning career from an aircraft mechanic to a software developer and no longer had a need for those tools. What’s worse is they were going to leave that account open and active until I finally caught up with them two weeks ago. I knew the figures were absurd as soon as I heard them but it took this long to actually get the details on what had transpired.

[Teslafan101]

we are allowed 2 Paypal accounts,there is no reason to question why a person has 2 accounts with physical addresses 3000 miles apart,some folks move out of the country and open an account in another country but keep his US account.

But you said the other account has a UPS address,my speculation is that someone could have been banned from Paypal or Ebay or both and need to keep selling on Ebay so he used your SSN etc to open a Paypal account to accept payments.

It is a crime to steal other 's SSN ,you should report this person.

Paypal knows who this person is,he has a Paypal account with your SSN but he should have his own address and bank account linked to that Paypal account and if he is selling on EBay,his Paypal account is linked to his Ebay account wich should have his name and address.

If you dont know where t o report him,ask IRS.   

[bgswansonlocc]

I’ve already reported it to the FBI and the FTC

[spiritedquill]

I just got my 2020 1099 from Paypal. 

EVERY FIGURE IS INCORRECT!
It's as though they picked random transactions and reported to IRS without ANY verification. 

Paypal is doing this entirely wrong and it's bordering on fraud. 

When you issue a 1099, the figures are supposed to be correct, Paypal!