This same situation is happening to a friend of mine but I think you might have missed the part where the person said that there is a specific button you have to click in order to make your account become a commercial use account. I think the issue was that they weren't using it for commercial use and yet google essentially treated it as one. My biggest takeaway here is that there is no real answer to the question. If someone uses the service to split bills it can't be considered income, if anything wouldn't it be reimbursement or considered like some sort of short term loan? I mean I've paid for concert tickets for a few of my friends on my credit card and they paid me back at a later date, was I supposed to report that as income? <-----(Actual question) I should also mention that google hasn't sent them a tax form yet, they informed them that they will unless the account is really not being used for commercial use. So, with this info does it change the answer? What should my friend tell google to attempt to not have them try to report their transactions? My understanding is that a pretty big chunk of transactions were because they were holding money for friends, in order to buy vacation tickets, airfare, hotels, etc. The friend gets discounts on these things, so everyone paid them and they bought all the tickets and such.
