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Does Ebay or Paypal report our sales to IRS?

janies_bizz
Enthusiast
I just started selling on Ebay and Im a little worried about reporting my extra little income. Its not that much but is there like a certain amount that I have to make for them to report or how does this work? Any help would be appreciated. Tax time is near.
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Re: Does Ebay or Paypal report our sales to IRS?

Re: Does Ebay or Paypal report our sales to IRS?

I just got the same letter for 2014 I host a group buy in. I'm the sucker that just agreed to be helpful. How did your issue turn out ?  I am freaking out. I had no idea   I collected money and purchased the goods and sent them out to thise that purchased 😞 

Message 212 of 236
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Re: Does Ebay or Paypal report our sales to IRS?

I have a online business and have to report sales within my state. IRS was going to close me down because of a previous year, one month of $4.00 in taxes was not reported. believe me , they want every Penney.
Message 213 of 236
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Re: Does Ebay or Paypal report our sales to IRS?

do you have to meet both in order for the 1099 to be issued?

-make over $20,000 AND over 200 items sold.  or do you only have to meet one of them?

 

i think most people meet the 200 but not the $20,000. where do those people fall in the 1099? do they get one or not? just curious. thanks

 

Message 214 of 236
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Re: Does Ebay or Paypal report our sales to IRS?

Since 2011, PayPal has been required by the IRS to report the sales of goods and services for customers who, in a single year receive:

More than $20,000 USD, AND
200 or more payments.
The new IRS 6050W changes apply to all payment providers, including PayPal. This includes payments received after January 1, 2011, with the first reports sent to the IRS in early 2012.

You can find more information and FAQs about the new IRS 6050W requirements on the PayPal IRS 6050W website.

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Everyone has options. Just be sure the best option is right for you.
Message 215 of 236
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Re: Does Ebay or Paypal report our sales to IRS?

Ran out of edit time. First half is still useful.

Everyone has options. Just be sure the best option is right for you.
Message 216 of 236
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Re: Does Ebay or Paypal report our sales to IRS?

You probably will not see this reply, but I appreciate your taking the time to explain this to us.  I've never sold anything on eBay, but I have thought about giving it a shot.

Message 217 of 236
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Re: Does Ebay or Paypal report our sales to IRS?

Ebay just reported my ebay sales to the IRS for 2014 and 2016.  The IRS is demanding their share.  Its a whopping 40% tax!!

Message 218 of 236
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Re: Does Ebay or Paypal report our sales to IRS?


@airborne7395jm wrote:

Ebay just reported my ebay sales to the IRS for 2014 and 2016.  The IRS is demanding their share.  Its a whopping 40% tax!!


You should have been reporting your sales all along. How big is the penalty? Not the tax, but the penalty for not reporting.

Message 219 of 236
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Re: Does Ebay or Paypal report our sales to IRS?

I've been using eBay for a few months now.  If I'm correct, you do not receive any tax forms, unless you make at least $20,000 or 200 payments within that year.  (Although I'm wondering what it means when one has to make "200 payments".)  However, I have been required to pay my fees whenever my monthly invoices are posted.  Are the fees reported to the IRS?  And I know that you wouldn't receive 1099-K forms (unless the aforementioned conditions are met); but would you still receive any kind of tax form for any income you make with eBay sales, nonetheless? And if so, will they be automatically reported to the IRS?

 

 

 

 

 

 

 

 

 

 

 

 

 

Message 220 of 236
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Re: Does Ebay or Paypal report our sales to IRS?

You have to report income earned, regardless if you met the numbers from PayPal to send the form.
You will need to contact a tax advisor for information.
If you're selling things you previously had in your possession, there are different rules.

Everyone has options. Just be sure the best option is right for you.
Message 221 of 236
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Re: Does Ebay or Paypal report our sales to IRS?

Okay; but how do I do that?

Message 222 of 236
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Re: Does Ebay or Paypal report our sales to IRS?

Do what?
You can find all payments through PayPal.
If you haven't kept track of the things you bought, resold, expenses and such throughout, not sure.
I'm not a CPA, nor Lawyer, nor IRS.
You need to contact one of them for information.

Everyone has options. Just be sure the best option is right for you.
Message 223 of 236
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Re: Does Ebay or Paypal report our sales to IRS?

Ebay and all other online selling platforms issue 1099's which are for reporting misc. income to the IRS -- IF -- you earn $20,000 AND have 200 or more transactions!  

 

white_check_mark   Therefore, keep accurate records of the following for a tax reduction (IRS for Schedule C business expenses) to accurately reflect your income:  

-  Amounts paid for postage 

-  Amounts paid for inventory (sold items and unsold items you will not longer sell)

-  If and or when I reach the thershold I am subtacting 50% for my own cell phone (not the entire family plan) 

-  If and or when I reach the thershold I am subtacting 50% for my internet fees (not the entire family plan)

-  eBay (and other seller platform you use) fees 

-  PayPal fees

-  Supplies you actually purchased

-  Milage (as of 2016 it was 54 cents a mile) for buying  and/or pick up trips for items you sell (there are some decent tracking apps for that otherwise you need to keep very good paper records just in case you are audited) 

 

NOTE:  There may be other income or expenses that apply to your unique situation.  I am not a tax accountant or tax attorney or IRS representative.  

 

Also, tax laws and rules change annually.  THEREFORE check with an actual tax professional you trust and/or www.irs.gov directly for the most accurate information.   

 

 pushpin  ALSO, keep in mind your income from this adventure may be subject to STATE INCOME TAXES (if your state collects) and perhaps Sales Taxes.  

 

 

 

Message 224 of 236
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Re: Does Ebay or Paypal report our sales to IRS?

ITS TRUE IF YOU SELL OVER 20,000 AND 200 ITEMS IN A YEAR PAYPAL HAS TO REPORT IT.

i JUST GOT A LETTER FROM IRS FOR 2015 TAX YEAR SAYING I OWE 21,000 INCLUDING FEES.

Message 225 of 236
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