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Community Member
Posts: 191
Registered: ‎12-31-2015

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

in reply to janies_bizz
No, it means that Paypal doesn't issue a 1099. You still pay taxes on your profits.

This is not a difficult concept.
Community Member
Posts: 1
Registered: ‎01-04-2016

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

in reply to janies_bizz
So, if you make less than 200 sales and less than 20,000....you don't have to report it out claim it on taxes?
Community Member
Posts: 2
Registered: ‎11-07-2009

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

in reply to janies_bizz
Whew! Thanks I was sweating there...yeah under my total sales amount they have the entire amount listed but when I called they broke it into two groups...I will have to call them again, thanks for the reply.
Community Member
Posts: 12,062
Registered: ‎05-18-2013

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

in reply to mabelsgreatstuff4you

Hi Mabel, According to the PayPal FQS page, Friends and Family money received should not be counted for 1099 purposes:

 

Are personal payments that I receive counted in the total that will be reported to the IRS?

No. Personal payments that are not payments for the sale of goods or services will not be counted when determining if the IRS thresholds have been reached and will not be included on your Form 1099-K if you exceed the thresholds. However, all payments received for the sale of goods or services will be used to calculate the gross payment volume to be reported. PayPal monitors accounts to ensure that personal payments are not being used for sales of goods and services.
 
Perhaps this FQS page has been revised by PayPal, but I have not seen any revisions.  I would call PayPal back and have them look at the link I provided and ask to see the new policy that includes Friends & Family payments totals in your 1099 in writing.  If the PayPal Customer Support reps are anything like the eBay CS reps, they don't always dole out the correct information 
 


How much better life would be, if a liar's pants really did catch fire!  winking fire flame photo: smile flame smiley_fire.gif

Community Member
Posts: 2
Registered: ‎11-21-2015

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

in reply to janies_bizz
I called paypal yesterday because my ebay sales totaled 15,000 but paypal had me at just over 20,000...I freaked and called. The irs department at paypal told me it was because I had received the extra money in friends and family payments from relatives. I said how can they tax money that my family already paid taxes on? He told me they include that. I am reading here in another thread that amount is filtered out when paypal considers whether to send a 1099k...does anyone know for a fact which is correct??? Thanks.
Community Member
Posts: 12,062
Registered: ‎05-18-2013

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

in reply to henryviiofengland

@henryviiofengland From PayPal:

 

PayPal is required to report gross payments received for sellers who receive over $20,000 in gross payment volume AND over 200 separate payments in a calendar year.In order to help you understand these changes, we have prepared the following FAQs.

 

FAQs:

 

https://www.paypal.com/webapps/mpp/irs6050w



How much better life would be, if a liar's pants really did catch fire!  winking fire flame photo: smile flame smiley_fire.gif

Community Member
Posts: 1
Registered: ‎11-15-2015

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

in reply to nextoonew

I'm a little confused about this 200 sales AND $20,000 thing. So are you saying that if I don't meet BOTH of those criteria then the income doesn't get reported? In other words, if I sell more than $20,000 in that year but it amounts to less than 200 total sales for that same year then it DOESN'T get reported? Is that correct?

Community Member
Posts: 1
Registered: ‎10-28-2015

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

in reply to lovelywatchforyou

if you're selling PERSONAL items then there is no profit or loss taken....for example, If i sell my car for $10,000 and I paid $20,000 for it new and it was just my personal vehicle then no loss or gain reported...same if you sell your sweater, shoes, etc...you used your money to buy it (which you earned from your job to which you already paid tax on) so selling it just recoups that money...no big deal...so cleaning out garage, yardsale items, etc are n/a which is why they use the 200 items and $20,000 rule for reporting.

 

If however you're in teh business of selling items you bought then you need to report it and should report anything you run as a business...For example, I start a business with $1000...i spend that $1000 at local garage sales buying items i know i can sell for more online...I sell those items i collected for $2000...you now have a $1,000 gain that you need to report and pay tax on.

Community Member
Posts: 23
Registered: ‎03-04-2005

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

in reply to midgee1924

You mean you paid sales tax on new stuff that you buy but you don't want to pay tax on the profit later? If you are a reseller you can avoid sales tax in your state by obtaining a resellers license with your vendors. Some eBay sellers do not accept them since they have not set up a business per se and they only waive sales tax for resellers with a resellers license.  Income tax on profit only, sales tax depends upon where you live and if the seller has a presence in more than their own home state (warehouse or address or retail store). Everybody that makes money ends up paying sales tax anyway except in those states that don't have sales tax and choose income tax instead usually higher taxes based on earnings.  Most everyone pay income tax to fund highways, schools and military though our roads and bridges and infrastructure are crumbling since no one will vote to rebuild anything. No one likes to pay taxes but death and taxes are the only sure thing.

Community Member
Posts: 5
Registered: ‎07-31-2005

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

in reply to lovelywatchforyou

Its 200 in sales AND 20K not OR  BIG difference....

Community Member
Posts: 1,764
Registered: ‎01-19-2010

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

[ Edited ]
in reply to ravewings

ravewings wrote:

Minimum wage(artificial wage), peace time military(policing the world), social security(ponzie scheme), healthcare(redistribution) are usually the reasons people don't pay taxes.


If excise taxes aren't enough, it's because the budget isn't efficent; more taxes are just more money thrown away.



Exactly my point. You want someone else to pay, because the govt doesn't spend it correctly.

I'm not stupid. I know they spend other people's money foolishly.  I also know a lot of that money goes to relatives/family members.

But when it's all said and done-

Enjoy that long drive on an non-bumpy interstate highway without getting sick at whatever diner you might stop at to eat.

Which you can't experience in a lot of countries. I love USA.

 

Hope everyone has a great summer!

Community Member
Posts: 1
Registered: ‎05-30-2015

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

in reply to kansas_gal06

Minimum wage(artificial wage), peace time military(policing the world), social security(ponzie scheme), healthcare(redistribution) are usually the reasons people don't pay taxes.


If excise taxes aren't enough, it's because the budget isn't efficent; more taxes are just more money thrown away.

Community Member
Posts: 5
Registered: ‎03-12-2013

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

in reply to ausrob

May I ask do you apply for tax registration certificate? do they require to have it if your activities as business?

Community Member
Posts: 5
Registered: ‎03-12-2013

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

in reply to kansas_gal06

Do I need to apply Tax Registration certificate if I file my income on schedule C?  I read online they will let you pay large amount of penalty if you failure to register . But I don't think all the ebayer realize this .


kansas_gal06 wrote:

sandrasvintagetime62 wrote:

...  Why don't they go after and spend money on the real problems in this country like terrorists, drugs, murderers, rapists, and etcccccc. ....


Well, they ARE going after money!  Your money!  And mine!  So they can spend it.

 

Glad to hear you kept receipts! With receipts you have proof so it will probably go OK. Best of luck!


 

Community Member
Posts: 4,156
Registered: ‎07-15-2013

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

in reply to janies_bizz

janies_bizz wrote:
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.

Yes, you are required to file all income.  Also, several states require you to pay taxes from buying out of state on purchases you bought on the web is recorded.  Remember, everything you do on the computer is recorded. 

Community Member
Posts: 1,764
Registered: ‎01-19-2010

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

in reply to lovelywatchforyou

lovelywatchforyou wrote:
Make sure you dont exceed more than 200 sales or $20,000 sales whichever comes first . And if you do business on ebay make sure you keep all reciepts such as postage, original reciepts. Or you you sell old stuff with no reciepts you loose so, its better to sell just few not exceed 200 sales or if sell cars for cost 20,000 dollars , Paypal will report to the IRS. If you have large family , ask them if you can use thier SSN numbers for few sales . Paypal is very quite about this and they do not let people know or even send customers a mail form 1099 .

Oh, so it's OK if you make over $20K not to pay taxes by spreading out the income over family member SSNs? 

But all us minimum wage workers who make even less than that per year get to pay full freight, so we're the chumps funding the military, social security, healthcare for you?

What a mooching freeloader.

 

Community Member
Posts: 3
Registered: ‎11-25-2013

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

in reply to janies_bizz
So sorry for those who sells old stuff , or sells garage stuff, how can you find the old reciepts to report to the accountants as an expense,?
Community Member
Posts: 3
Registered: ‎11-25-2013

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

in reply to janies_bizz
Paypal will based on you SSN or EIN . You could close your paypal account and they still report you no matter what because it is in their record base on your SSN .
Community Member
Posts: 3
Registered: ‎11-25-2013

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

in reply to janies_bizz
Make sure you dont exceed more than 200 sales or $20,000 sales whichever comes first . And if you do business on ebay make sure you keep all reciepts such as postage, original reciepts. Or you you sell old stuff with no reciepts you loose so, its better to sell just few not exceed 200 sales or if sell cars for cost 20,000 dollars , Paypal will report to the IRS. If you have large family , ask them if you can use thier SSN numbers for few sales . Paypal is very quite about this and they do not let people know or even send customers a mail form 1099 .
Community Member
Posts: 1
Registered: ‎02-09-2011

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

in reply to sandrasvintagetime62
me too , paypal do not send me a 1099K form, now i received an income tax bill for $29,000/year, IRS require me to pay $14,000 included penanlty refund money that government give 2 children last year .i don't know why ebay , paypal do not notice us about this, i think you right , i want to say goodbye ebay