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Anyone going to slow their sales down?
GroceryRackPack
Posts: 2,605 ✭✭✭✭✭
Hi,
Is anyone going to slow down their sales with this new $600 tax gig?
Any thought and or ideas?
Thank you again and have great day. 
1
GroceryRackPack
Posts: 2,605 ✭✭✭✭✭
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Is this the eBay thing?
The big boys i.e. PWCC, REA, Goldin do not adhere to this psychosis.........
Doubtful its ever going away as taxes rarely leave, so for me, no, but will be keeping up with purchases better to help offset sales
https://www.cnbc.com/2021/03/26/its-going-to-get-harder-to-avoid-telling-the-irs-about-income-from-online-sales.html
https://community.ebay.com/t5/Announcements/New-1099-K-tax-reporting-requirements/ba-p/32556521
Want to bet?
The IRS sent me a letter two weeks ago requesting that I revise/amend my return to report my PayPal sales. Reading into and messing around with the amendment stuff on TurboTax, I need to report it as self-employed income.
If you keep individual sales under $600, is there a maximum total for the end of the year to receive a 1099? Supposedly even friends/family count. My cousin sends me $400 a month f/f for money he borrowed over the past couple of years. It's certainly not income but now sounds like they want to treat ANYTHING as income. I might have to have him mail me actual checks. What a pain.
Pretty sure it’s $600 total not $600 max per transaction
FYI, They changed it from $600 to $10,000 limit…
https://abcnews.go.com/Politics/biden-admin-backs-tracking-bank-accounts-600-annual/story?id=80665505
Hey fmclaug,
That link seems Pretty Awesome!
That's what I want to hear.
Do you know of any Ebay updates on that link?
Thank you
It used to be $20,000 in payments, plus 200 transactions, but I'm not sure if that's still the requirement.
Speaking for the state of Ohio, in regards to ebay sales, the previous rule was any sales totaling $20,000 AND 200 transactions were subject to be reported to the IRS via 1099-K form. The new law that was supposed to take effect in 2022 was total sales of over $600 regardless of how many transactions.
Now with this new $10,000 limit from the ABC News link, I'm not sure if that means ebay or just personal transactions. I'll definitely be keeping an eye on it.
Personally I won't nerf my ebay sales with this new tax BS going on... I'm just going to do my best to keep track of my card purchases and shipping material costs (padded mailers, envelopes, labels, etc.) so I can try to offset the taxes. For 2021 I had a total of $15,174 in sales across 1,483 transactions, and I expect 2022 to be about the same. It sucks, but I guess the government has to do something to recoup the billions it handed out during the pandemic. So much for protecting the little guy.
I just checked ebay and they posted this on December 20th, so it appears it's still $600 for ebay:
Hey jeffcbay,
Now with this new $10,000 limit from the ABC News link, I'm not sure if that means ebay or just personal transactions. I'll definitely be keeping an eye on it.
You and I will be watching this for sure; as with many other members here.
I just checked ebay and they posted this on December 20th, so it appears it's still $600 for ebay.
I'm not really sure if ebay actually knows what's going on either.
Thank you
From what I understand the $600 is for marketplace items such as eBay, while the $10,000 has to do with your bank inflow and outflow. In other words, even if you do a private sale and deposit the proceeds in your bank, they will keep track of non-wage yearly deposits exceeding $10k and report it to the IRS.
https://usnews.com/news/us/articles/2021-10-19/us-treasurys-yellen-says-democrats-propose-10-000-irs-bank-reporting-threshold
eBay Store
Greg Maddux #1 Master SetGreg Maddux #2 Basic Set
Hey Maddux69,
One would think that ebay would realize this; it may take a little time for ebay to do some updates.
Thank you
Ebay is showing that $600 platform, this what I don’t understand: you can get 10’G’s from someone from PayPal, but you can’t 2,000 in sales from Ebay ?? I’m totally lost on that one
I don’t understand this whole $10,000 bank account threshold at all. There is still a gift exemption of $16000 from any person that is tax free. So if a friend of mine gifts me $15 K and I deposit it in my bank account, that is not taxable income.
During the pandemic I have been grocery shopping for my mother in law, and she has been giving me a check to cover it, which I deposit in my checking account. That is not taxable income.
Everything deposited in a bank account is not necessarily taxable income. So what is gained by reporting that activity to the IRS?
Hey PaulMaul,
I'm totally with ya...but that $600 Ebay platform is Insane!
For those of us that buy/sell at shows, be prepared for cash transactions.
It won't affect me because I report my sales. Technically, all sales have always been taxable. The main difference is now the IRS will get a 1099 for anyone selling more than $600. I guess the alternative to selling is holding items you don't want indefinitely because you don't want taxed on the sales. I understand the psyche, but if you really think about it, that strategy doesn't make much sense unless you think tax rates will eventually be lower in the future.
My other question is, how long will ebay keep that $600 platform or could that $600 increase to a somewhat of a higher number?
The IRS goes after the little guys, but ignores the fact that eBay has billions stashed in offshore accounts that they never pay taxes on. I'm all for paying my fair share, but let's make sure eBay pays their fair share as well.
I already report my sales and registered as a business many years ago so it doesn't matter much to me but this just seems like a mountain of paperwork to monitor and interpret ...........
Yup, eBay telling the IRS that I "made" $50,000 on their site is a bad thing. That number will be seriously reduced when I deduct the shipping charges and eBay's ridiculous fees on everything (sold items, shipping and even sales tax!). "Red flag this one, boys!" "EBay said he made 50k, but he's only declaring half of that!" "Time for an audit!" Lol!
It has always been my understanding that the $10,000 amount for banks was a magic number that would automatically trigger a SAR (suspicious activity report). I'm not sure if that is still the case.
Yes, that is currently the case. But what is being floated as part of the BBB bill is that any bank account with $10,000 of activity during a year (it was originally $600!) has that activity reported to the IRS. I’m just not understanding what the IRS is going to do with that information, since that is not necessarily $10,000 of taxable income. Will it flag you for auditing? Seems overly invasive if the goal is to go after rich tax evaders. Make it $100,000 if that is the goal. $10,000 is small potatoes.
How did someone determine the amount of $600? That makes No Sense.
I don't get why?
Thank you
This has nothing to do with the 1099 reporting.
Ask your congressman. It was government determined.
Hi,
I would like to say: “Thank you” to everyone here that helped me with this $600 tax gig.
Those folks better stop advertising sales figures or they will heading for perp walks and frog marches.
PWCC and those other folks may not fear the FBI fraud investigations, but having the IRS on their case may cause them to stain their shorts.
It's the singer not the song - Peter Townshend (1972)
You said it with class, thank you. This whole $600 reporting thing shouldn't be a big deal, because we all should already be reporting our gains. In my opinion, the only thing the 1099 does is give you a number to see if you agree with your total sales.
The new rule has nothing to do with new taxes. It has to do with reporting the taxes you should already be reporting.
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Successful transactions on the BST boards with rtimmer, coincoins, gerard, tincup, tjm965, MMR, mission16, dirtygoldman, AUandAG, deadmunny, thedutymon, leadoff4, Kid4HOF03, BRI2327, colebear, mcholke, rpcolettrane, rockdjrw, publius, quik, kalinefan, Allen, JackWESQ, CON40, Griffeyfan2430, blue227, Tiggs2012, ndleo, CDsNuts, ve3rules, doh, MurphDawg, tennessebanker, and gene1978.
The reporting doesn't bother me as much as the record keeping required. As mentioned above, if I sell $600 I may have only had a profit for a small fraction of that.
NFL HOF Set
https://www.psacard.com/psasetregistry/publishedset/398345
No issue with the reporting, but the record keeping is challenging especially going back to stuff I bought 20 plus years ago.
Some interesting questions: if you crack a $200 box of cards, and find one really nice hit and sell it for $200 - can you claim no gain? Even though there are some residual cards sitting in a bow on the shelf?
$600 is not much and it is smart that people will be looking to create a business to offset any potential taxes. Has anyone looked at whether you can deduct paying yourself a wage? The time to do all this personal card business management should be considered a cost that can be applied against the income.
Of course eBay will also pass on the cost of reporting the sale... so expect a new snitch fee from feeBay.
Exactly. Every CD or DVD I sell is at a loss, since I paid $12 to $20 each for them 20 years ago. I'm lucky to get $5 for them now. Who keeps receipts for those items for 20 years?
If you pay yourself a wage, you'd need to claim those wages on your personal income. You'd probably be an independent contractor, so you'd have to do the double SS payments. I can't imagine it'd be worth it.
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Successful transactions on the BST boards with rtimmer, coincoins, gerard, tincup, tjm965, MMR, mission16, dirtygoldman, AUandAG, deadmunny, thedutymon, leadoff4, Kid4HOF03, BRI2327, colebear, mcholke, rpcolettrane, rockdjrw, publius, quik, kalinefan, Allen, JackWESQ, CON40, Griffeyfan2430, blue227, Tiggs2012, ndleo, CDsNuts, ve3rules, doh, MurphDawg, tennessebanker, and gene1978.
I’m no CPA, but those can probably be used as losses to offset some of your card/memorabilia sales gains. Sell one card at $100 profit and offset it with 10 CD sales at a $10 loss each (or 20 at a $5 loss - just don’t go too crazy with the original value of the CDs). Come to think of it, maybe I’ll start offloading my old CDs to offset gains this year - I’ll definitely be asking my tax guy this year about that possibility.
Jim
what is funny is this policy is supposed to target the high net worth earners but the bulk of the people who are going to get these 1099's with no idea what to do with them are regular working people. all the releases say " consult with your tax advisor" but I am pretty confident the guys who will be getting 1099's for a few thousand in sales don't have tax advisors so this will cost them more to file taxes or it will cost them when they get audited for ignoring the 1099 they received for selling all their used clothes on ebay.
I always thought there should be some it's part of my life test. like if you sell your house you get a large exemption that you don't pay takes on. if I sell a few cards that were part of me living my life because I bought them a long time ago and thought they were cool, there should be an exemption before the gov't takes their ppound of flesh
I am of the opinion (do not treat this as tax advice) that if you use even the crudest estimates of cost you have less than a 1% chance of being audited. In the event of an audit, I think it unlikely that there would be any penalty applied other than having to justify your basis and perhaps pay increased taxes where the IRS disagrees. Any attempt at fraud would, of course, be treated differently, but if you claim to sell a Jordan rookie you bought in 1989-92 for about $500, I would think that would be good enough to avoid a penalty. Besides, the IRS simply isn't going to have the resources to audit everyone who has a few thousand dollars in collectible sales.
The rich will always find a way around paying taxes, while passing laws to be sure the poor pay their "fair share". That's because they're aren't any poor people running the government...
I do think it would be counter productive for the government to hire tens of thousands of IRS agents (as has been proposed) to go around harassing small time sellers. The net gain would be less than the cost of administering such an effort. The goal should be continued encouragement to self report while focusing audits on those filers whose tax payments would make it worthwhile to audit.
will consignors be issuing statements to people who send cards to them to sell? If someone sends 10 cards to Probstein, for example, and they sell on Ebay for $3500 total, will Probstein just include that in some giant total at the end of the year for all of the cards he sold for everybody, or will they issue something to the person who sent him the 10 cards? Obviously wouldn't want Probstein and the owner of the 10 cards to both claim $3500 in sales for the 10 cards...
I'm sure it will be both. That is, eBay will issue a gigantic 1099 to Probstein and Probstein will issue somewhat smaller 1099s to everyone who has consigned over $600 to him, probably net but possibly gross. I'm sure that large operators like them will comply with the law.
I wouldn't want to test that theory! Since when does the government do anything that's cost efficient?
https://www.ebaymainstreet.com/issues/1099-k-federal-tax-reporting
The IRS is going to have their hands full just trying to figure out how to tax cryptocurrency trades.
This was a very good year for sales on my end and you pay up re taxes. This is the reality for sports collectibles.
Unfortunately, I will be stopping after $599 in sales.
I will be doing the same thing!