1099K / reports mismatch?

[goldazar]

Number of issues I'm trying to understand:

1. I'm totaling my transactions from Jan 1 to Dec 31, 2022 (including taxes collected by ebay) and my 1099 is about 5% higher.

2. I'm generating all my labels on eBay . When I total my shipping labes cost I get total about 20% lower from what it shoes under Performance > Selling costs > Sales Last Year > Shipping Lables Cost

3. I cannot find promotional listing fees in reports, did they forget to include it?

Something doesn't make sense here... any ideas?

[mam98031]

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@dhowardpeters1 wrote:

I am also having issues.  It is particularly concerning that my sales report, transaction report and 1099 all have different totals.  The only categories I have found to match perfectly are the fvfs.  I fully account my business in QuickBooks through the year as well, and I have found reconciliation of the eBay MP account to be  impossible.

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@dhowardpeters1 

Your 1099K numbers are your Gross Receipts, meaning the total money that came into your MP account during 2021 BEFORE any refunds or other deductions.

It is also based on the transactions that were represented in your Payouts.  So for example if you did weekly deposits, They happen on every Tuesday.  In December there was a few days of December after the last Payout of the year.  Any transactions on those days will appear on next year's 1099K.

[maker_usa]

I have run the report, reconciled it with my bank account however the 1099-K is $10,929.67 more than what I received through managed payments. 

I can only assume one of two things, the 1099-K is wrong or it includes sales tax! 

which one is it! and I know. my refunds do not amount to anywhere close to the difference.

[luckythewinner]

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@maker_usa wrote:

I can only assume one of two things, the 1099-K is wrong or it includes sales tax! 

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Late to the thread - apologies if these have already been addressed.

The 1099-K total includes payments that were refunded. Did you make sure that when you calculated your gross sales, you were not inadvertently netting out refunds?

I believe the 1099-K total is based on the date a sale was paid out to your bank account, not on the date of the sale or the date the payment was initiated. If so, have you double-checked the start and end of the year to make sure you included sales from late December 2020 in your 2021 total (if they were paid out in January 2021) and conversely eliminated sales from late December 2021 (if they were paid out in January 2022)?

[mam98031]

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@maker_usa wrote:

I have run the report, reconciled it with my bank account however the 1099-K is $10,929.67 more than what I received through managed payments. 

I can only assume one of two things, the 1099-K is wrong or it includes sales tax! 

which one is it! and I know. my refunds do not amount to anywhere close to the difference.

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Your buyers paid over than 10K in sales tax???

Your 1099K includes ALL money you received into your MP account BEFORE ANY deduction for refunds or costs of sale.

It does NOT include Sales tax.

[chubbycatcollectibles]

Mine was way off.  Not even close.  Nothing jives with ebay numbers

[mam98031]

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@chubbycatcollectibles wrote:

Mine was way off.  Not even close.  Nothing jives with ebay numbers

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@chubbycatcollectibles 

Did you read post 49

[scodajo78]

Hello all.  My ebay 1099-K was for a total of $9,520.17.  Net Sales $7,896.08.  Product Costs $5,245.90.  Seller Fees were $1,624.67.  The 1099K ebay reported to the IRS seems to match exactly to my Net sales + Seller fees.   When I subtract my personal product costs and seller fees from my Net Sales, I am left with about $1000 profit. 

As I am working on my taxes, the IRS is calculating my taxable income or profit as ~$2000.  I have tried adding my ebay seller fees total into the "commissions and fees" section of the expenses on the Schedule C form.  I have also added my ebay seller fees to my product costs to increase my "cost of goods sold" number.   Both of these entered separately give me a taxable income of $2000.  When I add the ebay seller fees number to BOTH "commissions and fees" section AND the "cost of goods sold" sections, my taxable income or profit falls exactly where it should. 

Am I missing something?  I feel like ebay should be generating 1099Ks that reflect net sales, less their fees.  I don't think that "double" reporting seller fees in both the "commissions and fees" section and "cost of goods sold" section is going to fly with the IRS.  Is there another way to designate these fees for the IRS to better reflect Net Sales and be taxed appropriately on actual profit?  Thanks for the help!  Scott

[rfmtm]

Ebay 1099K reports all incoming payments processed on your behalf as it should.   This is the same for all payment processors required to issue a 1099.  Things like fees, shipping labels, refunds, etc., are all post payment entries, so as such are not deducted.  Only ebay collected sales tax is not included, because it was never part of any payment the went to your account.

[lacemaker3]

@scodajo78,

eBay has to calculate 1099-K forms according to the IRS instructions. They are calculating them correctly.

The 1099-K form has to include all payments that are processed into your account. That would be your managed payment account, before eBay fees, shipping labels, refunds or anything else. eBay  is not allowed to adjust the payments received, you have to do that when you file your Schedule C business expenses.

The 1099-K is not the sum total of your payouts.

The 1099-K is the total amount of all payments that were processed into your account:

• purchase price
• shipping cost paid by the buyer

The 1099-K does not include:

• sales tax paid by the buyer (because it not processed into your account).

The 1099-K is not adjusted to account for any business expenses such as:

• returns
• refunds
• cancelled transactions
• eBay fees
• cost of shipping labels
• cost of packaging supplies (boxes, bubble wrap, ...)

You have to keep track of all your business expense and enter them into the appropriate lines on the Schedule C. eBay fees can go under "advertising" for example.

You should definitely not be double reporting your seller fees. If you're doing that, then you're doing something wrong. You should talk to an accountant or tax specialist who is familiar with this kind of business.

[scodajo78]

Thanks for taking the time to reply Lacemaker.  I really appreciate that.  It seems that I had my numbers off and that I was deducting my seller fees from my net sales numbers to calculate my profit.  Net sales are already minus seller fees, duh.  I am entering ebay seller fees under the "commissions and fees" section on the schedule C form and my taxable income number is MUCH closer now to my newly calculated properly actual profits!  Thanks again for reaching out with the help!  Scott

[autograph-fanatic]

1.  I had to run a separate report for my labels on paypal.  Some did show in my trans report that were purchased through my payouts. 

2.  Promoted listings fee is shown as "other fee"

[kh-vince]

Hi everyone,

Due to the age of this thread, it has been closed to further replies. Please feel free to start a new thread if you wish to continue to discuss this topic.

Thank you for understanding.