ETA Summary of IRS Rules on Information Reporting for Payment Cards

The Internal Revenue Service has released final rules (T.D. 9496) relating to information reporting requirements, information reporting penalties, and backup withholding requirements for payment card and third-party network transactions. These rules implement tax code Section 6050W and related changes enacted by the Housing Assistance Tax Act of 2008 that require payment settlement organizations to report payments in settlement of payment card and third-party network transactions for each calendar year.

The Electronic Transactions Association submitted comments to the IRS earlier this year on the proposed regulations; this is a summary of how the final regulations address ETA’s previously articulated concerns.