By Ira Winkler

I was reading about the plans for the IRS to want Internet sites to collect information on people who collect more than $5,000 in more than 100 transactions. I can technically see why, as the IRS potentially wants to crackdown on people who are making a lot of money on eBay and other sites. However the criteria in this case is ridiculous. For example, what about someone who sells 30 cars on eBay for $20,000 each? They wouldn’t have to report, while someone making many small transactions would.

Most importantly, it puts people’s Social Security Numbers in danger as the sites would have to collect SSNs to fulfill their requirements. Then they would have to store the info. More importantly, the sites don’t see the final transactions. If a deal is cancelled, or fraud is involved, the sites might not see it. The IRS would have a much more effective contention for getting credit card companies to report all companies with the same criteria. The credit card companies already need the SSNs and Tax ID numbers already, so it wouldn’t be any more of a security risk than it already is. That is accept of course for the possibility that the information would be stolen from the government.

Editor: I’m reminded of the book “Snow Crash,” more specifically the part surrounding the US government’s collapse after they lost the ability to collect taxes due to electronic currencies and other non taxable forms of commerce. The good news is you can always tax real estate, hard to hide that stuff.

Related posts:

1. Merchants Launch Overdue PCI Rebellion
2. Seeing Through the PCI Smokescreen
3. No Hacking Required
4. 9 year prison sentence for credit card theft
5. US Bill To Prevent Consumers From Protecting Themselves From Identity Theft

Posted by Ira.Winkler on Wednesday, May 9th, 2007, at 12:08 am, and filed under Articles.

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