Bill > S1425

This bill, known as the "Red Tape Reduction Act of 2025," aims to modify reporting requirements for third-party settlement organizations (like payment apps and online platforms) by reinstating a previous threshold for tax reporting. Specifically, the bill changes the Internal Revenue Code to require these organizations to report transactions only if they meet certain criteria: either the total transaction amount exceeds $10,000 in a calendar year or the number of transactions exceeds 50. This effectively raises the reporting threshold from the current lower standard, which was modified by the American Rescue Plan Act. The bill also extends this de minimis (minimal) exception to backup withholding rules, meaning that payments through third-party networks would only be considered reportable payments if they surpass the specified transaction number and dollar amount thresholds. These changes would apply to transactions settled after December 31, 2024, providing relief to small businesses and individual sellers who use online platforms by reducing their tax reporting burden and administrative complexity.

Budget and Finance

https://www.congress.gov/bill/119th-congress/senate-bill/1425/all-info