So... how many of the self-claimed "Coin Dealers" on and off eBay are legitimate business

stman

Hello all....
It seems almost anyone with an email address and a website these days can and Do call themselves a coin dealer or a business man or woman. I'm most interested how many of these sellers claim the income on their taxes.

Now I'm not asking if they do a little of the pencil whipping that is done by many.... but rather do they pay their dues.

So what you think..... Do most claim their coin income, and I'm mainly asking about the eBay sellers that have stated on here that they are indeed a "coin dealer, or run a business?"

I don't expect to win a popularity contest by this question, and never do anyway. But I'm just a straight up type of person.

Many on here know I own and operate my own business.... and yes I do pay my self employment taxes, Liability and Bond insurance, among many other dues it takes to run a legitimate business.

jeffnpcb

That looks like a giant GOOSE-EGG to me. Only referring to raw coins that look like road kill but always said to be XF or better!!
Coin Dealers , EBay sellers and legitimate busniness people is a contrdiction of terminology!

michael

lol LOL L*O*L well they are business people ....................... i guess


sincerely michael

jadecoin

Our accounts are audited by a public firm, and our taxes are submitted by an independent accounting firm. ALL of our sales are on the books and subject to scrutiny. It would be foolish to do otherwise.

- j c c

Outhaul

So what's the difference between not claiming the money on your taxes and a dealer collecting state sales tax and not turning it over to the state? I know of a number of dealers who do this.

I'm not a dealer, I only sell a coin because I upgraded it. If I make a couple of bucks on it (which is rare) I don't claim it; nor do I do business with eBay dealers who insist on collecting sales tax.

Jeff: There are just as many reputable dealers on eBay as there are scumbags. The best way to protect yourself is to stick with someone you know or by staying away from raw material. In my opinion and experience, most of the raw stuff on eBay is $hit.

Cheers,

Bob

ccrdragon

I sell duplicates and upgrades on ebay, but on most of those I usually end up taking a loss on the coin that I am selling (I haven't figured that one out yet...). I do not claim to be a dealer nor a businessman - I am simply a private individual getting rid of some stuff.

For the part-timers, it really doesn't matter. Until you cross a certain threshhold (I believe $600 worth of INCOME) the IRS doesn't even care or require that you report it on your taxes.

ursabear

I report the income from my micro-business and I pay the proper taxes, dues, and insurance.

Russ

I report my coin sales. It makes for excellent loss writeoffs.

Russ, NCNE

CarlWohlforth

I pay taxes. CA Sales tax, income tax, payroll tax and more. It takes a lot of bookkeeping to be official, but I wouldn't do it any other way.

dorkkarl

i'm a greedy son-of-a-gun. i grasp every single penny of profit from sale of a coin like it's the last coin on earth

it's mine! all mine!!!

K S

Barry

<< <i>So what's the difference between not claiming the money on your taxes and a dealer collecting state sales tax and not turning it over to the state? I know of a number of dealers who do this. >>


I'm not a lawyer, but I believe the difference is "failure to pay sales tax" vs. fraud. I would think fraud is more serious.

On another note, while I'm not a CPA (though my father is and I asked him about this in the past), any income derived from coin sales, even if you're only a "collector," is taxable. There are no minimums or exemptions. You can write off losses against gains, and you can write off your expenses (travel to shows, home office, etc.) against income, but a "hobby business" cannot declare a net loss and take it as a write-off against income from your real job.

Russ

<< <i>but a "hobby business" cannot declare a net loss and take it as a write-off against income from your real job. >>



Coins fall under the capital gains and losses rules, so one can indeed write off losses against income. The IRS certainly wants it's pound of flesh if one realizes a profit on the sale if their collection. Even they cannot have it both ways.

And, unless they've changed the hobby business rules, one is a allowed to writeoff losses against income, but there are restrictions on the number of years, either consecutive, or within a specified period.

Russ, NCNE

stman

Just to be clear once again of the intent of this thread..... it was not to put anybody on the spot. And wasn't directed at the person that sells coins here and there, but to the self-claimed dealers and people that say they run a business selling coins. I see them enter threads all the time about dealers and claiming to be one.....So, I was curious if they paid they're dues as a business person.

None of my business really, but I do commend the ones that do pay their dues and the VERY FEW that said so in this thread so far.

Or maybe I decided to ask these questions because our recent tax time of April 15th I wrote a big fat check to pay my self employment taxes, and see all these people claim to be in business and I suspect many don't own up to what it takes to really be in business. Yup it sure takes away the profit don't it?

Regards, and thanks for anymore replies.

Outhaul

I agree, stman...I too applaud those dealers who pay their way. I wouldn't want anyone to think I just made a shotgun statement in my previous post implicating ALL dealers.

Cheers,

Bob

Typetone

I'm not a dealer and don't know the rules that apply to a business. However, for a collector, my understanding is that purchases and sales are subject to regular capital gains rules. I believe that losses can be applied against gains, but as far as I know, $3,000 is the maximum net loss per year (for all capital sales combined). I believe that any additional loss can be carried forward. If you want to defer taxes on gains on coin sales, but keep the money in coins, I believe that you can do a like-kind exchange.

Greg

Strat

Stman, your post reminds me that I have an estimated tax payment due next month

nickel

A most interesting question . As there is no 'license' needed to be a coin dealer , what constitutes being one? Is it someone who makes a living selling coins? Do you need to have a coin shop? If you set up at X amount of coin shows per year , do you qualify? How about a vest pocket dealer? If you lose money , are you no longer a dealer? If you sell coins occasionaly , you are a collector who may try to upgrade your collection . A dealer may buy coins to sell exclusively for profit . Taxes dont nessesarily make you a dealer . An investor and or collector is supposed to pay capital gains ( deduct losses) on sales . A business would pay income tax (deduct losses) on sales . A collector would not be liable for tag sales , as most garage sales are not taxed . A dealer at coin shows may or may not be taxed for coin sales at a coin show , because some states exempt sales of coins . EBAY is an extension of the above . Where one falls in or decides to do is on individual bases . If you buy a coin , does it matter if seller is a dealer or not ?

BigD5

I probably fall into what you are looking for stman. I am a self employed contractor, and a partner in some real estate ventures, and I do a considerable amount of coin selling via Ebay etc...... I DO file taxes for my coin sales, and keep track of my expenses etc. I have a very competant CPA, who makes sure my ship is sailing on the up and up, and is organized. I pay quarterly, for my contracting and my coin trading. I live in N.H., and there aren't any sales tax issues, but if I was in Mass., I'd fill out the proper paperwork etc. with the state and pay the proper taxes.
I never consider myself a "dealer", but I guess if I'm filing taxes for coin trading, maybe I am in a sense.
When I decided to start selling extensively, I sat down with my CPA, and we came up with a game plan on paperwork etc. Things are moving on, so another "meeting" is set next month, and more changes will be made.

joejeweler

Russ.......there ARE exceptions to your statement that even the IRS "cannot have it both ways"........they can and DO!

I do realize that this is a slight sidetrack from discussing coin dealers and their business practices........but it IS still coin related. Why........because on a good year i can buy a whole lot more monsters!

Case in point........as a somewhat successful part time "professional" casino blackjack player, i've found the normal business rules don't apply.

For instance.......in any given year any net profits from gambling are taxable as ordinary income. Losses can only be offset by winnings for that year, and cannot be carried forward into subsequent years. Also, .....net gambling losses for any particular year CANNOT be used to offset any other income!

So......"hypothetically", this year i may show a $20,000 net profit on my blackjack play.....and pay perhaps $5,000 in both federal and state taxes. However, in either the previous year or following year i may have showed a $10,000 loss, but can't claim a dime of it as a loss against ordinary income!

Seems the IRS "wants to have it's cake and eat it too". Benefit or share in a winning year and not share a losing year. Like it or not there ARE fulltime (and partimers like me) professional blackjack or poker players, who treat it like a business. Travel miles are logged, and toll reciepts and hotel costs (if not comp'd by the casino) are all tally'd into the cost of doing business. What's left at the end of the year is either a net win or a net loss.

The IRS wins along with you if it's been a sucessful year..........but a loss is all yours!

The IRS does have it both ways!
Joe T



<< <i>

<< <i>but a "hobby business" cannot declare a net loss and take it as a write-off against income from your real job. >>



Coins fall under the capital gains and losses rules, so one can indeed write off losses against income. The IRS certainly wants it's pound of flesh if one realizes a profit on the sale if their collection. Even they cannot have it both ways.

And, unless they've changed the hobby business rules, one is a allowed to writeoff losses against income, but there are restrictions on the number of years, either consecutive, or within a specified period.

Russ, NCNE >>

Russ

Well, Joe, gambling is evil.

Russ, NCNE

joejeweler

Hehehe.......but not as evil as coin doctors!



<< <i>Well, Joe, gambling is evil.

Russ, NCNE >>

Iwog

Answer: Zero, because being a coin dealer isn't a legitimate business.

Thought you'd like that one. If there's a coin dealer in this world who doesn't have the special "cash discount" (read tax fraud) for special customers, I have yet to meet him. I would conservatively estimate that 90% of ALL coin dealers, ebay or otherwise, play games with their cash sales and I'm willing to bet it's far closer to 100%. Now I'm not saying that other business people are more ethical, but the nature of being a collectables dealer just makes it easier.

dorkkarl

iwog, i don't think that's true of coin dealers. wannabe's, maybe, but a lot of dealers i have bought from actually prefer a check over cash becuase of the paper trail it provides. in fact, i could tell you a story of a dealers who once refused me a sale - because i couldn't write a check, all i had was cash

K S

Russ

Iwog,

Just how many times have you been screwed by dealers? Must have been quite a few for you to arrive at the conclusion that 90% to 100% of them are crooked.

Russ, NCNE

topstuf

Iwog.... you are ignorant of some basic facts.

Being a "collectibles" dealer quite often subjects one to MORE....not LESS....scrutiny.

Your blanket assessment of 90-100% of coin dealers screwing with cash sales is bunk.

I had two audits while dealing coins. One state, one federal.

BOTH are marked "Recommend acceptance as filed." (great to have as it stops the audit-go-round)

You are right that SOME dealers fudge. But the ones with deep pockets and DECENT customers (meaning those who will PAY the required sales tax) most assuredly do not f*** with the numbers.

MY toughest row to hoe was CUSTOMERS who would leave rather than pay sales tax.

MOST of my good coins went to other dealers or auctions where I stated that tax would be collected if they lived in California.