How to collect rent with new IRS Rules?

Question

I was reading about how the IRS is going to be more stuck on Venmo, Cashapp, Zelle, etc. for collecting rent from tenants. I wanted to get some thoughts on this and even if it is true?

If it is true what other payment options for tenants would you recommend?

David M. · Answer

@Boston Caruthers

Hmm...  I don't think it really matters.  You plan to declare the rental income on your tax returns either way, right?  Just because the services file and IRS form doesn't change your reporting.

Alecia Loveless · Answer

@Boston Caruthers I don’t care what the IRS is requiring from my electronic payments because I claim all my rent. If my tax preparer says I need something from all the platforms then I’ll worry about it but until then I’ll just go on about my business and report my rent to the IRS based on how much I know I receive from each tenant each month.

Colleen F. · Answer

@Boston Caruthers  I believe the 1099s you will receive will be like any other 1099. The thing you might want to watch for is mixing business and personal money received. Make sure that money you receive from friends and family you have noted as money for personal shared expenses. I think you can designate friends and family in the apps.

It is absolutely true that reporting will be done, it is just a question of timing. If you want to accurately record payment you can use ACH bank to bank transfers through one platform like say apartments.com.  It is anticipated all third party platforms will be issuing 1099s.  ACH bank to bank and zelle  not through a third party platform I believe are the only ones not currently slated to issue 1099s since it is bank to bank but if you get audited the government will look at those as well.

How to collect rent with new IRS Rules?

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