Warning: This article is fairly long, and is mostly about a particular situation which, by itself, is pretty dang trivial, though it is a symptom of the "Big Brother" mentality that so many Americans have. (Those who sell things on Amazon might have a personal interest in it.)

 

I sell my books through Amazon.com. Apparently there are new IRS regulations requiring the reporting of certain payments, such as what Amazon pays to those who sell things on Amazon, if--and only if--the seller makes more than 200 sales in a year AND makes over $20,000 in a year in sales. I barely meet the first criteria, and don't nearly meet the second criteria (unfortunately).

However, Amazon.com is now telling anyone who sells stuff on Amazon that they must supply their Social Security Number (or other TIN), no matter how much they make in sales, if they exceed 50 sales in a year. Considering how huge Amazon is, this would no doubt include hundreds, if not thousands, of merchants who do not at all meet the legal criteria. Here are excerpts from my exchange with Amazon:

1) Amazon (from an e-mail they keep sending out): "beginning with the 2011 tax year, new IRS regulations require Amazon to file a Form 1099-K for sellers who exceed $20,000 in unadjusted gross sales and 200 transactions in a calendar year. To assist in complying with these regulations, we are requiring sellers who exceed 50 transactions in a calendar year, regardless of monetary threshold, to provide their tax identity information."

See the bait-and-switch? They pretend that demanding Social Security Numbers from everyone with more than 50 sales is being done "to assist in complying with these regulations," when that's obviously not true. In the case of those who don't meet the 200/$20,000 requirement, Amazon is just making up their own requirement, completely unrelated to what the IRS requires.

2) Me (in a message to Amazon): "As you know, pursuant to 26 USC 6050W(e)(1), a return (Form 1099-K) is required only when the "gross amount of the reportable payment transactions" exceeds $20,000 in any given year. Because that is not the case in my own situation, there is no legal requirement for Amazon.com to file a return regarding transfers made to me, and therefore no legal requirement for me to supply any Taxpayer Identification Number to Amazon. As such, your request for my TIN (which would be my Social Security Number) has nothing to do with any legal requirement, but is simply a request from a private business (Amazon) to a private individual (myself) to supply a Social Security Number, and really has nothing to do with the new federal reporting regulations."

But wait, there's a twist. My note continues:

"As you may know, requiring an individual to provide his Social Security Number (and in some cases, even just requesting it), when there is no reporting requirement or other law mandating it, violates state law in Alaska, Kansas, Maine, Rhode Island and New Mexico."

So I objected to their new policy, and objected to them pretending they're just doing it to comply with the new rules, when that is patently untrue. Their response? They repeated their policy, and ignored the issue.

3) Amazon: "Beginning in 2011, sellers who exceed 50 transactions in a calendar year, regardless of sales volume, will be required by Amazon to provide taxpayer identification information to Amazon. If the required information is not provided to Amazon by December 26, 2011, your Amazon selling privileges will be suspended until you provide the information."

Um, yeah. They already said that.

4) Me: "Doing a cut and paste of what you sent before is not answering the question. You are requesting an SSN, and threatening to deny services if you don't get it, even though you have no legal basis for doing so. ... You are asking for something you obviously don't need--which you've done without before, and which you're specifically not allowed to have in several states--and pretending it has something to do with the new IRS regulations, when it doesn't."

Their response to that succinctly summed up the situation.

5) Amazon: "We understand that your sales does not increase (sic) $20,000 annual threshold. However the TIN information is required if the seller crosses 50 transactions in a given year irrespective of the sales volume. The sellers having more than $20,000 in unadjusted gross sales, and more than 200
transactions should file a 1099 K form. However we require the TIN number if the seller is selling more than 50 items a month."

So they acknowledge that the new rules do NOT apply to my situation, but proclaim that they require me to provide my Social Security Number anyway, as a condition of receiving their services. Then they again sent me the first e-mail (at the top) proclaiming that the need the number to comply with the new regulations. So I responded.

6) Me: "Why do you keep lying, claiming you are demanding TIN numbers 'to assist in complying with these (new IRS) regulations,' when you are demanding TIN's from people who don't at all fall under the new rules, such as myself? Anyone making under $20,000 a year in Amazon sales is NOT SUBJECT to the new rules, and you know it. When you demand a TIN from someone who does not meet the criteria, such as myself, you are NOT complying with regulations; you are making up your own demands, without a shred of legal basis, and in direct violation of several state laws."

I would bet money a lawyer wrote their response, since it just drips with spin and obfuscation.

7) Amazon: "Please note that it is not only $20,000 in gross sales but they take into consideration if you exceed 200 transaction as well. The new Internal Revenue Service (IRS) regulations require that US third-party settlement organizations and payment processors, including Amazon, file Form 1099-K to report unadjusted annual gross sales information for sellers that meet both of the following thresholds in a calendar year:

- More than $20,000 in unadjusted gross sales, and
- More than 200 transactions."

Notice they just acknowledged what I said: both criteria must be met, and I only meet one of them. Nonetheless, they then repeat the lie, by adding this:

"Upon reviewing account I see that you have exceeded the IRS threshold and have about 296 orders placed in a calender year hence please understand that this decision is ultimately left to you if you wish to provide info or not but as per the rules you are required to enter this information before the 26th of Dec to avoid suspension of your account."

So they are STILL pretending that demanding a number from me, as a condition of rendering services, is about complying with the new IRS rules, instead of about complying with something Amazon just made up on its own.

8) Me: "I asked why you keep lying. Your response was to lie again. As your own e-mail says, the new 1099-K requirements are for those who meet BOTH criteria: over 200 transactions AND over $20,000 in sales in one year. I meet the first, not the second (not even close), which means I am NOT subject to the new rules. Yet you continue to demand a TIN, as a conditioning for rendering services, when doing so directly violates state law in several states (not in Pennsylvania, however). Why can't you at least be honest, and admit that in many cases, your request for these numbers is UNRELATED to the new regulations? Again, I don't understand why Amazon would expose itself to a lawsuit from anyone residing in those states where it is illegal to demand an SSN as a condition for rendering services. But at least please stop pretending that requesting MY Social Security Number--and however many hundreds of others in my position--has ANYTHING to do with the new rules. You know that it doesn't."

9)  Amazon: "It is Amazon’s policy for Amazon.com sellers that exceed 50 transactions in a calendar year, regardless of sales volume, to provide taxpayer identification information to Amazon. If the required information is not on file by December 26, 2011, your Amazon selling privileges will be suspended until you provide the information. Please understand that this is a fixed constraint and that we are unable to answer further correspondence about this issue."

Well, at least that time they didn't pretend it was because of the IRS rules that time; they just said it was "Amazon's policy." (They still didn't mention the fact that their "policy" violates several state laws.) Ultimately, the folks at Amazon will decide whether to require Social Security Numbers as a condition of rendering services, and I'll have to decide whether to do business with them or not.

But what's worth noting here is not about my case. No doubt many readers of Freedoms Phoenix are well aware that when the Ponzi scheme known as Social Security was pitched to the masses, the politicians zealously promised that the new numbers would never be used for general identification purposes. For a long time, the cards had printed right on them that they are not to be used for that. Well, as I often say, whenever a politician says, "The reason we're doing this is not because..." whatever comes out of his mouth next is the exact reason they are doing it.

Today, Social Security numbers are used all over the place, for all sorts of things, and not just by the parasites in "government." It's convenient and easy, so most people can't imagine why we shouldn't. It makes it so easy to keep track of everything, create huge data-bases, and so on. What could be wrong with that? If you have to announce your "government"-assigned number to get a driver's license, or open a bank account, who cares?

It's about privacy versus surveillance, and freedom versus control. Of course, the claim will always be made that privacy and freedom can create opportunities for people to do bad things. Well, no kidding. So why not just cage everyone, if it would make us all safer? Yes, a secret bank account, without even a name or a Social Security number, could be used by terrorists or criminals! Of course, it could also be used by good people, for perfectly moral purposes. And yes, when something shady happens, having a huge system of surveillance and record-keeping can making finding the bad guy easier. So while we're at it, let's install "government" cameras in all of our houses. Hey, wouldn't that make it even easier to catch bad guys?

Amazon wanting my number, even though the "government" isn't even requiring it, is pretty darn trivial in the big picture. But it's one of a thousand ways in which the surveillance-and-control society inches forward. And you can bet that whatever records any company that big keeps, the feds can snoop into it whenever they want, with or without a warrant, and with or without the knowledge of the company.

"Hey, we just want to know, and keep track of ONE tiny little extra tidbit of information about you. What's the problem?" The problem is that all of those tiny little tidbits add up to everything. And if, every inch of the way, we just quietly go along to make things easy, where do you suppose we will end up?