Starting next year, the IRS will require payment processors (including PayPal) to report how much money each user has received through their service. Many of us will probably be exempt from this since it only applies to sellers who sell more than $20,000/year AND who have 200 or more transactions.
The time is also coming when we will have to provide our Social Security Number (or employer ID # in lieu of a SSN) to whatever payment processing companies we're registered with. If we fail to do this, the processors will have to do backup withholding (this is usually a rate of 20%) starting in 2012.
More info here: