Venmo does a slightly better job at trying to help landlords report their taxable income. But there are still several things that could be improved regarding tax reporting and business functionality. To start with, Venmo has restrictions that discourage users from making business transactions with each other unless they have a verified business account. VENMO TAXES: THEY’LL HELP, BUT YOU’LL PAY FOR IT Venmo Personal vs. Business Profiles Does a Venmo Business Profile Save the Day?
A landlord using a personal Venmo profile to collect rent payments violates Venmo's User Agreement, and the company can review and deny any payments they find. Venmo's Business Profile can help you get around some issues by automatically tagging every payment you receive as "goods and services." But business profiles are only available to some and come with additional fees. To date, a Venmo Business Profile will charge 1.9% + $.10 per transaction. (Source: Venmo Business Profile article)
If approved for a Business Profile, you can start accepting tenant payments. Venmo will categorize that rental income and provide you with a 1099-K. So, if you’re willing to jump through a few hoops, Venmo is pretty good at tracking money that comes in. But what about the money that goes out for expenses? That’s a different story. Venmo doesn’t categorize expenses very well, and there are limits to how much you can send out in payments (if Venmo doesn’t decline them outright). Plus, if you wanted to connect to accounting software like QuickBooks — you’re out of luck. Venmo doesn’t play nice with integrations, so there’s no way to connect your account with whatever software you use to track expenses, catalog receipts, or manage customer information.
A VENMO BUSINESS PROFILE WILL CHARGE 1.9% + $.10 PER TRANSACTION.
Quick Recap of Venmo’s policies
• Venmo will report business transactions to the IRS. • They will issue a 1099-K, but only if you have a Business Profile. • You must submit paperwork and be approved for a Business Profile. • Venmo doesn’t integrate with bookkeeping software (i.e., Quickbooks).
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