119-s1425

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 1425 Introduced in Senate

    (IS) ]

<DOC>

119th CONGRESS
 1st Session
 S. 1425

To amend the Internal Revenue Code of 1986 to modify the exception for 
 de minimis payments by third party settlement organizations.

_______________________________________________________________________

 IN THE SENATE OF THE UNITED STATES

 April 10, 2025

Mr. Cassidy (for himself and Ms. Hassan) 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 modify the exception for 
 de minimis payments by third party settlement organizations.

 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 ``Red Tape Reduction 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 
 $10,000, or
 ``

    (2) the aggregate number of such transactions exceeds 
 50.''.

    (b) Effective Date.--The amendment made by this section shall apply 
to transactions settled after December 31, 2024.

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 amendments made by this section shall 
apply to calendar years beginning after December 31, 2024.
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