For anyone paying their taxes already, nothing changes other than getting a 1099-K form they didn't get before. And if you "send money" but don't flag it as a "sale", then no 1099-K generated.
For example I pay my rent through Venmo to my landlord. The IRS will be able to see the rental income on Schedule E.
But I do agree it's going to be near impossible for the IRS to reconcile it consider things will be flagged as "sales" that really aren't. And if you lend you friend $600 in cash, and they repay you through Venmo, what do you do? You ignore the 1099-K, and if the IRS comes knocking, you tell them it wasn't business income.
My guess is that it'll go the way of FBARs for foreign bank accounts. The system is such a mess, so inaccurate, that it'll just collect data the IRS can't really do much with unless they audit someone and choose to pull the data and compare to the return.
For example I pay my rent through Venmo to my landlord. The IRS will be able to see the rental income on Schedule E.
But I do agree it's going to be near impossible for the IRS to reconcile it consider things will be flagged as "sales" that really aren't. And if you lend you friend $600 in cash, and they repay you through Venmo, what do you do? You ignore the 1099-K, and if the IRS comes knocking, you tell them it wasn't business income.
My guess is that it'll go the way of FBARs for foreign bank accounts. The system is such a mess, so inaccurate, that it'll just collect data the IRS can't really do much with unless they audit someone and choose to pull the data and compare to the return.