When you say "Venmo made me "make" one up at sign up" what exactly do you mean and that its withholding your tax refund?
Did you get a letter from the IRS stating that they have information that you had income that you didn't report? Did you get a 199-K from Venmo?
If so, then you will still need to report the 1099-K. If you received a letter from the IRS, then on that letter there is information on what to do if you do not agree with their changes. If you have not yet received the letter, then watch for it in the mail and when it arrives respond accordingly. If you do not receive a letter, you will need to contact the IRS for further assistance as they are the only ones that have information on why your refund is delayed. If they believe you did not report all of your income, they will make the changes and adjust your refund and unless you respond, the changes will remain.
At this point do NOT amend your return. You should ONLY do what the letter tells you to do so that you do not cause further delays.
For future years, if you receive a 1099-K from Venmo or another electronic payor, even if you are not a business, you will still need to report it on your return. Then the amount that is not for services, or payments you will just back out of the amount that is just for gifts and repayments from friends and family. This income is reported on a 1099-K to both you and the IRS if you received more than $5,000, however some companies issue them for much less.
To enter the 1099 K and then back it out immediately take the following steps:
- Income
- 1099-K under Other Common Income
- Enter the information from the 1099-K
- Check the box that says, This amount in box 1a is too high or includes some personal transactions
- Enter the amount that shouldn't be included
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