1099K doesn't match Financial Statement

[jnjtra]

So I'll preface by saying I live in Massachusetts where I get a 1099K comes every year regardless of sales volume.

This is my first year where eBay is sending me one though instead of Paypal. Paypal's 1099Ks used to match my own records perfectly. eBay's doesn't. In fact, the 1099K doesn't even match eBay's own monthly financial statements.

In January, for example, the 1099K says my gross was $863.83.

When you add up all of my transactions for that month (not including the tax automatically remitted by eBay, which I know the 1099K doesn't include), you get $949.82. eBay's full financial statement from January as well as my own spreadsheet support this.

I did give one refund that month for $43.82 but that doesn't explain the discrepancy.

More baffling, some months actually do match their financial statements and my own spreadsheet perfectly.

I'm just wondering what I'm missing here or who I should call at least besides regular eBay customer service.

Has anyone else had this issue? Thanks.

[caldreamer]

1099 shows gross sales (purchase price + shipping) total amount that you received from the customer.   When you deduct business expenses be sure to include cost of  "shipping labels".

[gatefold]

seems odd that some months are accurate....my only guess is that the "settlement dates" might be off some months by a day or two.....sale date, post date, and settlement date are 3 different events on differing days....

that would even affect the total for the year and account for a month being off by a specific amount....

seems like you have decent records.....does the discrepancy amount equal any combination of individual sales around the beginning or end of the month(s) that is/are wrong?

quick and dirty example....February 2021 has $50.00 gross sales on your spread sheet.....but the 1099-K has $40.00...you had a 'sale' on February 28 (your sheet), but it did not settle until March 02 (added $10.00 to March total on 1099-K...making 2 months on the 1099-K wrong compared to your spreadsheet)

[jnjtra]

Yeah, I think that's what's happening the more I look at it.

Another troubling thing I found is that my 1099K said I had 162 transactions for 2021 even though when you add up all the transactions from January 21 to December 21 off of the statements manually, you get 161.

That's because eBay was counting a transaction I had on December 31, 2020 as part of 2021, probably because the payment didn't settle until the next day, despite it not appearing anywhere on the January 2021 financial statement.

It was throwing off my whole yearly total.

Honestly, just garbage book keeping and transparency on their end. I'd trust a middle school pre-algebra student to do better.

[jda11121]

So you don't like how they calculated the amount.....would recommend you change how you calculate because they are not going to change theirs.

[silverstatetreasureboxes]

@jnjtra 

Ebay is correct, the transaction you had on December 31st of 2020 was just that " a sold transaction " payment for this transaction was received on January 1st of 2021 so therefore money was in 2021. Your 12/31/20 transaction should have appeared on your statement in December. 

[jnjtra]

I didn't say I didn't like how they calculated it; I said I was confused and had a question. Then I questioned the transparency and pragmatism of their bookkeeping process because the financial statements they provide to sellers don't match the 1099Ks they send out.

That said, most people are still keeping their books sorted by the date a transaction happens, not the date the payment for that transaction clears. They're dong so if only because Paypal had done it that way for more than a decade and even because eBay's own public facing financial statements do so as well. So be prepared for a lot of confusion and the same exact question, especially next tax season when these lower 1099K thresholds roll out nationwide.

[jda11121]

Hopefully by then people will actually know the difference between sold date, pay date and transfer date...but I'm not counting on it.

[jnjtra]

So tell me then, where can you easily find the pay date in Managed Payments?

Because I see the sale date and transfer dates easily on the Payments tab under Recent Transactions. But unless I'm there refreshing the page manually to see the pending funds go into available funds, I can't easily find the date the payment posts.

[gatefold]

when you download your monthly numbers, utilize the "Performance" Tab -----> Sales

This popup indicates that these numbers are when paid, not when sold......

[gatefold]

i am just thinking out loud here....to test this theory, if you select "Last Year" from the select box, the total in box 1 SHOULD equal your 1099-K

no?

[gatefold]

LOL...replying to myself (so I do not mislead anyone)

That Number WILL NOT equal the 1099-K (because of various adjustments such as sales tax, vat and returns/refunds)

sorry

[gatefold]

ok....disregard my suggestions.....they are not what you are looking for....they itemize and categorize sales completely different than I initially thought......my apologies

[gmores]

"Honestly, just garbage book keeping and transparency on their end. I'd trust a middle school pre-algebra student to do better."

100%

[dave-in-kc]

a middle-schooler wouldn't need pre-algebra to accurately record transactions!