I have a personal account on Ebay and Paypal. I sell a few non gun items and once in a while I sell a personal case or two or some used items. Well now both paypal and Ebay are requesting my social security#. if I sell $600 or more in a year they will report that as income to the IRS. Does not matter that it is my personal items, they still plan to report it. Its all reported as income. Even though it is not all profit and some is at a loss just to broom it out, it still gets reported as full income. Also, with all the data breaches I am very cautious about giving out my ss willy nilly as I have had my identity stolen twice.
I will expect gun broker will be next at this request
As of Jan 1, 2022, the IRS requires eBay to provide you with a Form 1099-K if you receive $600 or more in sales during the 2022 tax year. Last year it was 200 transactions or $20,000.00. Never miss a chance to tax anyone who is making a effort to do anything other than wait for free. Sad times. You might be ab oe to deduct the cost of items sold if you can prove the cost. Yeah, big chance I know.
I got mad so I Googled it. At least they will take into account the basis.
"No need to worry— you only pay taxes on profits. You won’t owe any taxes on something you sell for less than what you paid for it. For example, if you bought a bike for $1,000 last year and then sold it on eBay today for $700, that $700 you made would generally not be subject to income tax."
I'll tax the street (If you try to sit, sit) I'll tax your seat (If you get too cold, cold) I'll tax the heat (If you take a walk, walk) I'll tax your feet...
Use Amazon and eBay when you can benefit from them. You owe them nothing, they owe you nothing. When they no longer can provide a service worthy of your time someone will take their place who can.
Changes in their policies are not worth getting mad about. When they no longer provide you a worthy service, move on.
John nobody does, that’s the rub. They ought to make a simple exception for those who are selling personal stuff. But the problem is dealers who try to run their business as just selling their personal stuff. Some have multiple ids trying to get around the old $20,000 limit. So the IRS over tightened the rules. I guess you could claim your real cost of goods but if audited you might have a problem. The IRS is not your friend.
About five years ago, I cleaned out my gun room and sold a lot of factory stocks, new in box recoil pads, stock blanks and gun stuff I would never get around to using. Raised about $7,000. And I think I paid 13% for the privilege, but overall was happy. Today I would make a lot less. Last time I looked they wanted 13% on shipping. Use to be that was not included in the sale price. Might be different now. The problem was, wise dealers would sell an item for .99 and charge $25.00 shipping when it cost a couple bucks. Buyers did not care if the valued the item for more than 25.99. EBay only got a percentage on the .99 not the total of $25.99 so they changed the rules. EBay, like the IRS is not your friend as well.
There is another approach that may work, depending on your marginal federal and state tax income brackets, and on whether you itemize deductions or take the standard deduction. Donate the items to an eligible charity (college shooting team, FFA, Boy Scouts, etc.) and take a non-cash charitable deduction for the current market value of the items. Up to $500 per donation, all you need is a donation receipt and some documentation of current fair market value (from eBay, auction sales, GunBroker sales, etc.). Over $500, you'll need all that plus a letter from the charity. Over $5000 in a single donation, you'll need a formal, professional appraisal of the market value. You can do the math, but in a high tax state like California it's easy to have a combined marginal rate well north of 40%, which means you net 40 cents on the dollar of whatever FMV you can establish. And you don't have to find a buyer for your stuff or pay fees to sell and ship the stuff. Another alternative, if you still want to sell stuff, is to split up the sales among different venues (eBay, GunBroker, this site, Auction Arms, local auctions, gun shop consignments, etc.), and keep the gross receipts for each venue under $600 per year. And split your sales between 2022 and 2023. Lots of ways to work the system and still stay completely legal.
Disclaimer: I am neither a CPA nor a lawyer, but I am an Interdisciplinary Obfuscator, so please take this advice as a guideline and follow up with a trusted professional. This is off the top of my head, and tax rules are constantly changing.
One of my associates goes to the Caribbean every winter from the second week of January until the end of March. It’s part of his agreement with the company, it’s no big deal.
When I asked how it was that he was able to accomplish that, He explained to me that his wife had an eBay business. And it was all PayPal.
Here is where the story got interesting.
It seems, she spends all of her time shopping thrift stores and rummage sales in the upscale suburban communities of south eastern Michigan.
She focuses on seasonal change over and leather goods, i.e., purses and shoes.
Her cash income is well into six figures.
As a person who pays his fair share of taxes, and doesn’t engage in elaborate schemes to avoid them, my preference is that those transactions are taxable.
It has become pretty obvious to me that the non-tax paying, income earning segment of our national workforce is growing exponentially.
Heck, you can go to the beach nowadays, and you will see entire families rolling coolers along selling bottles of water for two dollars apiece or more. Or the endless parade of restaurants that are cash only, because their computers are down.
Your acquaintance should pay tax on what she is doing as she is making a living or at least many thousand of dollars doing it. For her it’s a real business or that is how I see it
But for someone who is not engaged in the business I feel there should be a cut off point
As a person who pays his fair share of taxes, and doesn’t engage in elaborate schemes to avoid them, my preference is that those transactions are taxable.
It has become pretty obvious to me that the non-tax paying, income earning segment of our national workforce is growing exponentially.
Heck, you can go to the beach nowadays, and you will see entire families rolling coolers along selling bottles of water for two dollars apiece or more. Or the endless parade of restaurants that are cash only, because their computers are down.
I believe the story here refers to six hundred dollars, not six figures. As to your non tax paying income earning segment, if you build it, they will come. Some will exploit the notion, but most will be forced into cash transactions for a few grocery items, or more likely their illegal drug addictions. Two thirds of the country has supposedly been reduced to living paycheck to paycheck, not on Caribbean vacation.
....As a person who pays his fair share of taxes, and doesn’t engage in elaborate schemes to avoid them, my preference is that those transactions are taxable.
It has become pretty obvious to me that the non-tax paying, income earning segment of our national workforce is growing exponentially.
Heck, you can go to the beach nowadays, and you will see entire families rolling coolers along selling bottles of water for two dollars apiece or more. Or the endless parade of restaurants that are cash only, because their computers are down.
I'm sorry but I can't agree with this, or anything else CZ said about hounding Ebay sellers for additional income taxes. My reason is simple. Our Government obviously does not really need the money.
If they were really short of money, they would be going after very big bucks in Income Tax they are losing to the Mexican Drug Cartels who are flooding our open borders with Billions of dollars of cocaine, heroin, fentanyl, etc.
If they were really short of money, they wouldn't be paying the salaries and benefits of U.S. Customs and Border Patrol Agents, while preventing them from doing what they are paid to do.
If they were really short of money, they wouldn't be giving free cell phones with paid service to illegal immigrants who broke the law to enter the U.S. by the millions. They wouldn't be giving them free medical care, public schooling, or Welfare either.
I understand that people with cash only businesses should pay taxes like the rest of us. But I don't like the idea of persecuting them just because they are working hard, while others get free stuff. I feel I pay way too much to subsidize able-bodied people who pay nothing. But would our Liberal Democrat friend also say that those who are collecting Welfare, Food Stamps, AFDC, SNAP, SSI, WIC etc. should also pay taxes on that income... which has amounted to Trillions of dollars over time??? Shouldn't they all have some skin in the game? Do they not use our roads bridges, schools, and taxpayer funded parks and infrastructure?
Would those folks on Welfare vote for the Party that is spending us into oblivion if a big chunk was taken out of their benefits to pay for all of it?
And how about Student Loans? The Democrats are pushing for unpaid Student Loan forgiveness, and the freebie would amount to $1.75 Trillion. Nobody is talking about making that freebie taxable income. Nor are they concerned about those who would foot the bill.
A final though is this. Let's say I sell something like my gun collection. Now we're almost on topic. I have no way to prove the Basis Cost on many of them. When you can't prove Basis Cost, the entire amount realized becomes taxable income. And much of the increase in value, which would be taxable income, could be attributed to Inflation cause by wasteful and reckless spending and massive debt, and to the increases driven by fear that anti-gun Democrats may restrict or ban them. Why should I be penalized for that?
That's one reason Ronald Reagan called Inflation the cruelest tax of all... one that affects the poor, and middle class, and retirees on fixed incomes the most. The last time we had very high Inflation, it was due to Democrat policies... just like it is now.
If you are liquidating a business, even if it’s years later, you have basis. When I sold a pallet of face masks to a govt entity, even though the business had been gone for years, I had basis.
People can whine about tax law compliance all they want, but at the same time there comes a point in time when a line has to be drawn, and the law imposed on the other side of it.
No matter the scale, if your effort was to extract value from the item, if you are selling it for more than your basis, above a certain figure it is taxable.
But like many things in life, it’s always the other guy who is the bad guy.
Crazy how bad it had become and encouraging to read about the improvements, it also re-enforces my belief that we need regulation that both encourages growth and protects our environment.
Rivers on fire, that is an era we do not need to return to.
I’m probably the only person on the side who has actually worked there.
That region was post apocalyptic when I first badged in.
We would laugh, because it was so toxic, not even a weed would grow.
We would watch the occasional weed reach up out of the cinders, only to wither and die.
I think Zug Island is very possibly the most contaminated place in North America.
Everyone that I worked with that spent any time there and long-term health consequences, and most of them are dead now.
Now we let other countries poison their citizens and destroy their rivers with iron smelting.
I actually found the process of converting iron ore into big slabs of steel fascinating. Watching them roll around on railroad cars as they cooled, or seeing the big furnaces tapped and decanted into vessels as they rolled around the complex, was pretty cool to me..
Crazy how bad it had become and encouraging to read about the improvements, it also re-enforces my belief that we need regulation that both encourages growth and protects our environment.
Rivers on fire, that is an era we do not need to return to.
No matter how far it has come, it is still, and always will be, a dung pit under the control of the same political party for about a hundred years.
Best, Ted
______________________________________________________________ Home sweet home, if you be Lonny, or Insane Clown Posse.
Zug Island-- Great Lakes Steel Corp, National Steel and the GM owned McLouth Steel.. Peabody Coal Corp. Muhlenberg County KY-- just for "openers" on the great big table of environmental polluters, all in pursuit of the almighty dollar. And it will never end.. RWTF
Zug Island-- Great Lakes Steel Corp, National Steel and the GM owned McLouth Steel.. Peabody Coal Corp. Muhlenberg County KY-- just for "openers" on the great big table of environmental polluters, all in pursuit of the almighty dollar. And it will never end.. RWTF
Google Boat Harbour, Nova Scotia, Fox.
Textbook case of environmental racism and profit over people.
Heading up north tomorrow for a long golf weekend.
Have fun at work, Toad. lol
___________________________ Teamsters. Eewwwww
Good you are getting the hell out of the cesspool you call home, even if you have to play golf. Bet it feels just like you have to go to work on Monday when you are leaving.
Best, Ted
___________________________________________________________ Do you wear plus fours and breeks when you golf? You should.
1099s at a $600 threshold seems a little ridiculous to me. Especially being most folks are selling used stuff at a loss. But due to time, no documentation.
So on the other side. Say I sell my 13 year old motorhome or Suburban for a $50,000 long term loss. Guessing claiming that loss that would be denied. Even with all the paperwork.
But sell a $1000 worth of old used junk with out documentation as to costs and here comes the 1099.
You are talking about the IRS, what part did you expect to be fair? More active regulation is Biden’s direction. He wants everyone to pay their “fair share” of taxes. What is in dispute is what is fair and then how the money is wasted by the government.
I would favor a more reasonable figure like $5,000.00 instead of the $600.00 minimum which dates back to 1862 when the predecessor of the IRS was started. In 1862 income between $600.00 and $10,000.00 was taxed at 3%. Honestly, I think sale of personal property should be none of their business, but I know some will abuse that, to run a business and claim it all was personal property.
It is not just EBay you need to worry about. PayPal and other third party players who handle the money are going to be reporting transactions as well, I am told. If it is electronically paid, there will be a trail for the IRS to find and now they will just need to make them do all the work for the IRS. If third parties all report every yearly transaction greater than $600.00 there are going to be a lot of minor sales taxed needlessly to catch a few underground sellers.
What is needed, and will eventually come to be (if it doesn't already exist) is a website that is based upon the barter system, true bartering. I.e., "what do you have that you would trade me for this gun, or truck, or lawn mower?" No $$$ changes hands, just an even trade. The contacts could be made off the website, by phone or email. It would be a simple classified ad site for bartering, with no paper trail.
Yes, barter may be a work around, but it could be draining to fend off an audit. Among neighbors and at the local flea market it's maybe good stuff, but with unknown actors, interstate, involving flagged items, can-o-worms? Private face to face where legal is a beautiful and most American of things.
That's when I'll go "off the grid". Like a Cajun friend in boot camp told me when I was advising him not to go AWOL from boot camp so he could be there when his first child was born, "No man, if I get home to those swamps they'll never find me".
Lonny and Joe can laugh and ridicule all they want, but they don't know me. I've had a wonderful life doing what I love to make a living but, at 70 I could shuck it very easy and go "away".
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