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To amend the Internal Revenue Code of 1986 to reinstate the exception for de minimis payments by third party settlement organizations with respect to returns relating to payments made in settlement of payment card and third party network transactions, as in effect prior to the enactment of the American Rescue Plan Act, and for other purposes.
Summary
This bill reinstates the de minimis exception for third-party payment settlement organizations, raising the IRS reporting threshold to $20,000 in annual payments AND more than 200 transactions from a participating payee. Under current law, organizations report payments at much lower thresholds; this bill restores the higher threshold that was in place before the American Rescue Plan Act. The bill also applies the same exception to backup withholding requirements for third-party network transactions, effective for calendar years beginning after 2024.
AI-generated plain-language summary of the bill text — neutral, and may be imperfect. See the full text below for the exact wording.
Sponsor (1)
- Sen. Hagerty, Bill [R-TN] (R-TN)
8 cosponsors
- Sen. Banks, Jim [R-IN] (R-IN)
- Sen. Barrasso, John [R-WY] (R-WY)
- Sen. Blackburn, Marsha [R-TN] (R-TN)
- Sen. Grassley, Chuck [R-IA] (R-IA)
- Sen. Hoeven, John [R-ND] (R-ND)
- Sen. Hyde-Smith, Cindy [R-MS] (R-MS)
- Sen. Ricketts, Pete [R-NE] (R-NE)
- Sen. Tuberville, Tommy [R-AL] (R-AL)
Actions (2)
- Apr 9, 2025 Read twice and referred to the Committee on Finance. · senate
- Apr 9, 2025 Introduced in Senate
Similar bills (6)
Bills with similar text or summary — includes reintroductions across Congresses. Ranked by semantic similarity of the bill text (computed locally); a neutral discovery aid, not a claim the bills are duplicates.
Full text
IN THE SENATE OF THE UNITED STATES
April 9, 2025
Mr. Hagerty introduced the following bill; which was read twice and referred to the Committee on Finance
A BILL
To amend the Internal Revenue Code of 1986 to reinstate the exception for de minimis payments by third party settlement organizations with respect to returns relating to payments made in settlement of payment card and third party network transactions, as in effect prior to the enactment of the American Rescue Plan Act, and for other purposes.
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the “Stop the Nosy Obsession with Online Payments Act of 2025” or the “SNOOP Act of 2025”.
SEC. 2. REINSTATEMENT OF EXCEPTION FOR DE MINIMIS PAYMENTS AS IN EFFECT PRIOR TO ENACTMENT OF AMERICAN RESCUE PLAN ACT.
(a) In General.—Section 6050W(e) of the Internal Revenue Code of 1986 is amended to read as follows:
“(e) Exception for De Minimis Payments by Third Party Settlement Organizations.—A third party settlement organization shall be required to report any information under subsection (a) with respect to third party network transactions of any participating payee only if—
“(1) the amount which would otherwise be reported under subsection (a)(2) with respect to such transactions exceeds $20,000, and
“(2) the aggregate number of such transactions exceeds 200.”.
(b) Effective Date.—The amendment made by this section shall take effect as if included in section 9674(a) of the American Rescue Plan Act.
SEC. 3. APPLICATION OF DE MINIMIS RULE FOR THIRD PARTY NETWORK TRANSACTIONS TO BACKUP WITHHOLDING.
(a) In General.—Section 3406(b) of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:
“(8) Other reportable payments include payments in settlement of third party network transactions only where aggregate transactions exceed reporting threshold for the calendar year.—
“(A) In general.—Any payment in settlement of a third party network transaction required to be shown on a return required under section 6050W which is made during any calendar year shall be treated as a reportable payment only if—
“(i) the aggregate number of transactions with respect to the participating payee during such calendar year exceeds the number of transactions specified in section 6050W(e)(2), and
“(ii) the aggregate amount of transactions with respect to the participating payee during such calendar year exceeds the dollar amount specified in section 6050W(e)(1) at the time of such payment.
“(B) Exception if third party network transactions made in prior year were reportable.—Subparagraph (A) shall not apply with respect to payments to any participating payee during any calendar year if one or more payments in settlement of third party network transactions made by the payor to the participating payee during the preceding calendar year were reportable payments.”.
(b) Effective Date.—The amendment made by this section shall apply to calendar years beginning after December 31, 2024. <all>
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