Test and go live

Before going live, use your sandbox environment to thoroughly test the tax reporting integration. Your testing should involve:

Report generation

• Threshold testing: Test both federal threshold conditions by creating merchants with $20,100 and 150 transactions (should not qualify), $20,100 and 201 transactions (should qualify), and $19,900 and 201 transactions (should not qualify).
• KYC status: Test merchants with completed KYC, pending KYC, and revoked KYC.
• Multiple tax years: Generate transactions across different calendar years.

Webhooks and notifications

• Webhook setup: Configure and validate webhook endpoints.
• Event testing: Test webhook delivery for TAXES.REPORTS.GENERATED events (both regular and corrected reports).
• Webhook reliability: Test retry mechanisms and failure handling.

Corrections

• Quick corrections: Submit quick correction requests after KYC updates.
• Status tracking: Poll correction status endpoints.

1. Contact your PayPal account manager to enable Tax Reporting as a Service for your live account.
2. Go live with your app.
3. Configure webhook endpoints for the live environment to receive tax report notifications.
4. Update your API credentials to use live environment values.