I got this notice from Paypal. IF your sales exceed $2K a month they CAN HOLD your money for up to 21 DAYS (3 weeks) for the amount OVER $2K. I applied to up my amount to $5K. Said they would get back to me. IS this the IRS going after you and me? Back to checks and money orders

I don’t believe it’s an irs thing. The $20k to $600 tax reporting got delayed another year. It’s probably just a response to fraud. Banks get hit with millions in fraud every year. It’s only increasing so they continue to take measures to deal with it.

I once worked at Sallie Mae bank. I didn’t deal directly with fraud but it occupied a big department at corporate headquarters. I was in sales, so a lot of the approvals ran through the fraud department for verification and other issues.

I didn’t get a similar notice but I have a PP business account that’s been active for over 10 years. Your pp history does make a difference.

Paypal user since 2003.

I’m sorry for your 20 years of pain - lol.
I use PayPal but I’ve never liked it. They take way too much control of my money and transactions.

I love PayPal, but use it mostly for either paying for purchases or invoicing/reporting for my business. Even so, when invoicing, I usually create the invoice in PayPal, but then convert it to a PDF and send it via email.

That way my customers can pay via check and I don’t get fees taken out by PayPal. Granted, it adds a few steps and isn’t as convenient, but it works.

Yeah, but they made eBay possible, and with that all of the cyber buying for better and worse.

It’s always about control - doesn’t matter who’s doing the controlling.

Even the most benign explanation is that they would like to basically take a 21 day zero interest loan - at your expense.

Will always support you Mark even if that means by carrier pigeons

Your bank does the same thing on larger deposits. In fact, i remember BoA regularly hitting me with holds on cash (!) deposits. And that was some 20+ years ago.

Fwiiw, I had my limit bumped to 5k with PayPal without any issues.

Just because you are paranoid, doesn't mean that they are not out to get you.

Unfortunately, the only thing you can do is move to bank clearing credit cards, or going strictly to cash or check. Either way, it's a whole industry based on taking their pound of flesh. The question is how much and where?

Money changing is a very age old issue (making money from somebodies elses money) and it started long before Paypal.

Same story different actors, different plot.

Without getting too political, PayPal has been active in trying to control financial exchanges among people they think are political foes.

It may be a play to earn overnight interest on all that money they are holding.

Use Zelle. Almost all banks support it now.

I like Zelle for many reasons. It’s not the right platform if you are not sure about the person you are sending money to but if you are confident on that, it’s the way to go.

Used to be a thing.
I actually flew bank checks for Ameriflight for about a year. The small branches would consolidate in small townsm fly into Portland. Portland, San Diego, and LA would fly to San Francisco, to the Federal reserve, and the then They would be flown to a destination mid US for exchange with the East coast and central check, and fly back.

At the end, the trans cons could have over a Billion dollars worth of checks. Not quite the same now. The interest alone made economic sense to operate the planes.

As Mark said, fraud is a BIG thing these days. Its as simple as that, and a lot of banks have similar policies. They have to, in order to protect themselves.

Zach

Paypal = Great to send (apart from the outrageous exchange rates they use), shyte to receive

Concur. It does not offer the seller protections that PayPal does.

However, it's also not subjected to the 1099K requirement (which will eventually happen, as required by law; VITA tax prep guy here, not looking forward to that). The IRS can get access to your bank records records whenever it wants to...


As a consumer, I tend to disagree. PayPal is very much supportive of the sellers when there's a dispute; I've been shafted by a few scam sellers (not here) that used that to their advantage. For that reason I generally will not use PayPal for purchase transactions unless I know the individual/company; I get a lot more seller protection using credit cards directly.

And the PayPal/eBay connection has destroyed eBay's attraction as an individual non-commerical seller (of anything, not just car parts). Given the fees between the two, plus increasing shipping costs, I'm at the point where I'm just throwing away/scrapping things instead of trying to sell them, the juice and worth the squeeze.

I am truly puzzled why people have so much trouble paying 3% to use paypal when they pay the same amount for every credit card transaction they do at 90% of retail outlets, its just built into the price so you don't see it. If you decide to pay cash you are just increasing that vendors profits. Some places will offer a discount to pay in a means that doesn't have a transaction fee. There is a % price for convenience.

john

There are federal regulations that companies like PayPal and Stripe have to comply with, intended to verify that transactions are legit and no money launder8ng is taking place.

I think the bigger issue is that the 3% is a vendor fee. Unless we run a store we never see it. Paypal makes everyone a vendor, and many people (unfamiliar with how things work) are galled that they have to give 3% to another company for selling their pair of "vintage" shoes.

Or, they are scammers.

A friend of mine just got taken by a scammer who demanded "friends and family" for some car parts. He caught on just a bit too late, and there is no recourse.

Zach

I purchased a 914 (with Paypal) from the West coast a couple years ago, the seller claimed they did not release the funds for a couple weeks. But I continue to use them, mostly as a buyer. There is a level of protection

Nope. Never again.

From what I understand, the pay app requirement to send out 1099K's was delayed for calendar year 2022 but is in affect for 2023. So if you have or had $600 or more in your pay app account (PayPal and Venmo etc) in 2023, expect to receive a 1099K in the next few months.

Steve

We used to use only Paypal but they go worse and worse. We switched to Square.

The IRS can look at anyone’s bank account, why do they always go after one group of people? I could name a few names the IRS could look at bank accounts right now. They won’t, they won’t look at wealthy peoples bank accounts. They’re going after poor people who make a few thousand dollar purchase over the course of a year. They’re squeezing every last drop of blood from poor people.
Let’s not talk about the giant tumor on our brain that is causing this to happen. Let’s all be politically correct and pretend maybe it’ll change sometime.
Matt

It’s been delayed (again) for at least another year. So the $20k limit remains for now.