New IRS regulations require PayPal to collect TaxID information from customers when a transaction of more than $600 is processed. This can be in the form of a social security number or other business related Tax IDs (What is a Tax ID Number? | PayPal US).
In the last week, many PayPal customers are experiencing a problem where TaxID information is provided, PayPal’s system acknowledges the receipt of the information, but the hold on funds is not removed.
When PayPal customer service is contacted they acknowledge that this is a technical problem on their end. However, they are not able to provide an estimated time to resolution.
Some customers are reporting holds of more than one week at this time. I’m experiencing this myself – 3 day hold so far on a fairly large sum of money from selling a piece of gear. Needless to say I’m not pleased.
My advise is to use other means of carrying out online transactions until PayPal gets their sh*t straightened out…
No other service I’m aware of offers the same degree of buyer protection as Paypal. From a buyers standpoint, this is paramount when sending money to strangers.
edit: I just checked the Reverb seller center where they would usually give notifications about things like internal payment issues or Paypal delays and I’m not seeing anything there. Is this perhaps just an issue with private accounts? Also, how old are the Paypal accounts in question? and are they set up as personal accounts or seller accounts? PP may be cracking down on sellers who are registered with personal accounts - there may be some algorithm when randomly picks out accounts that are receiving X amount of money within a given amount of time.
Strictly hypothesis as I don’t have any data on this, but one would think after a week or more, Reverb would have huge delays and a general warning issued to save their staff from dealing with the same repeated seller inquiries about it. But then, Reverb does the collecting of tax information on their end, so perhaps it doesn’t change things for Paypal payments received through them as the mediator.
Sinister that you have to give tax ID for personal transactions, I mean it’s not like they don’t get enough tax off of literally everything you buy new, earnings, duty etc.
Do they use PayPal for handling payments in the US? I know you can pay with PayPal but I think they process the funds themselves like eBay started doing using Adyen. I get paid directly by Reverb (into my bank account) through my sales.
That’s not my point in using Reverb as an example - if there are Paypal delays, the seller won’t get paid because Reverb isn’t in the business of being a money lender. Until they receive the completion of funds transfer from Paypal, they won’t send the funds to a seller regardless of transaction status or the buyer having completed payment. My point is that holds on major accounts (a la Reverb) wouldn’t go unnoticed by anyone involved.
I’m not sure your speculation here is helpful. Let me make two points:
This is not a hold on an account, but rather a hold on a specific transaction. All other account activities, including continued purchasing and receiving funds are still enabled. Funds are acknowledged, PayPal acknowledges TaxID info received, etc.
PayPal has acknowledged this as a technical issue on their end – I have a specific support ticket number that refers to this ongoing issue that is affecting multiple customers. The number of people affected is not known to me but the link I provide to the PayPal community forum suggests I’m not an “n of one”
I guess my point was that if Reverb aren’t using PayPal as a processor (there’s a difference between accepting PayPal as a payment method and using them to process payments) then the transaction would simply fail at the point of sale, so I don’t think it would impact Reverb payments in any way. They use Adyen (at least in the UK).
Bit of a sidepoint either way but thought I’d mention! Might be a red herring.
If it’s strictly a technical issue then it should be worked out in short order, an $84.09 billion dollar company won’t let this degree of technical issue go on for too long, but you’re correct in that I’ve misunderstood this as a facet of implementation of policy and somehow glazed over the line about the acknowledged technical issue in the second half of the post.
You may consider editing to make the first line of your post that this is in regards to a technical issue instead of new IRS regulations, or edit the title to include the word Technical in front of the word issues.
