Public service announcement for sellers - eBay and sales tax
U1chicago
Posts: 6,157 ✭✭✭✭✭
As eBay keeps changing things up, I’ve noticed that certain subcategories in the coins and paper money section get charged sales tax while others do not (this is in Illinois but there might be similarities with other states).
From what I’ve seen in the law, tokens, medals, and supplies should be charged tax (in Illinois). Pretty much everything else coin related should be tax free.
These are the coin subcategories I’ve seen tax added so far:
-Exonumia
-Publications & Supplies
-Other Coins & Paper Money
If you are a seller and not listing exonumia or supplies, I’d recommend to not put your coin in those categories as it increases what the buyer pays and even adds a little to your seller fee (you pay a fee on the tax portion too).
I recently bought a US classic commemorative that was posted in one of those subcategories and tax was added (even though it should not have been according to the law). I went through with the purchase and it’s not worth the effort to battle with eBay for a refund but I thought it was worthwhile to make others aware when they are listing coins.
Comments
This is good advice in general. Adding categories can increase who gets taxed beyond just the ones you listed since it will all depend on what a given state taxes. Some may tax coins but not bullion, and listing a Silver Eagle as a commem or silver dollar will get it taxed. Where it gets tough is when two categories are appropriate: a book on bust halves would be appropriately listed in the book and early half dollar categories. If coins but not books are taxable (I guess the opposite is more likely, but you get the idea) the item gets improperly taxed.
It taxes the mind just keeping up with that crap.
Agreed (twice!)
@airplanenut the example with silver eagles is another interesting case. When eBay bucks bonuses come up (the 5%), bullion isn’t included but commems are. So in a state that taxes everything but bullion, the person is better off having a seller list it in bullion but in a state that does not tax coins, the seller is better off listing it as a Commem.
In general though, I’d go with whatever category is most appropriate (besides the examples like that book you mentioned which are trickier).
Another thing to consider is being open to having a buyer ask the seller to change the category when necessary.
Although I recall eBay potentially saying that was against the rules-does anyone know if it is or isn’t?
Edit: even if allowed, this would only work for buy it now listings as it would be too late on an auction with bids.
I've requested and had a number of sellers change the category of their bullion listings in order for me to earn the bonus bucks. Been doing it for years and have yet to see any recourse from ebay.
Exit bunker, enter Matrix. LOL
Cheating eBay and the tax man are two entirely different things.
My post has nothing to do with avoiding taxes.
Exit bunker, enter Matrix. LOL
I had one seller years ago get upset at that and he ended up losing the sale (and the item sat for a while). On the other hand, I had another case back in the eBay coupon days where a seller helped me move an item so that I could use that coupon. It definitely seems worth asking.