The article is really poorly researched. They mentioned that Etsy decided “not to cancel the transactions”. What does that even mean? You can’t cancel a transaction where the money has already been taken out or the account and magically expect it to return. Etsy has to push the money back into the account via a refund.

And money refunded is never considered income, so the second part of the article is completely unfounded speculation. Unless Etsy issued 1099s it doesn’t matter how much money they push into the account, it doesn’t mean it will be considered income.