Managed payments tax question.

[bargainsandbaubles]

Since eBay now deducts the selling fees from payments rather than being paid outright, how is this setup in a schedule C?

Would you enter your gross sales, ignoring the 1099-K then deduct the fees, or enter the amount from the 1099k and not deduct the fees? Thanks

[downunder-61]

https://www.ebay.com/help/selling/fees-credits-invoices/ebay-form-1099k?id=4794&st=12&pos=1&query=eB...

https://www.ebay.com/help/selling/fees-credits-invoices/reconciling-ebay-sales-transactions?id=4847&...

[caldreamer]

IRS requires you to report gross sales.    1099 shows "gross sales" (purchase price + shipping).   From gross amount you deduct expenses (EBAY fees, shipping costs, cost of goods, mileage, packing material, use of home office, etc).

If you are not familiar with business taxes I strongly urge you contact a tax professional.

[clarkphilatelics]

The sum of Payouts detail windows for the year is provides eBay related data for Schedule C but is the biggest obstacle to tracking payouts. Gross (income) and fees columns lack totals. Gross and fee amounts may post in a foreign currency. Postage amounts are in the gross amount column instead of the fee column. Sometimes payout detail spans two or more bank transactions. Offsetting withdrawals and deposits should be in separate reports. Today's payout report contained 305 lines, mostly ten cent insertion fees. It had to be imported into Excel to balance the account and split the payout into two transactions, taking about two hours to accomplish.

Tasks not done by eBay:

1. Total the Gross and fees column.
2. Convert all amounts to US dollars.
3. Move eBay postage fees to the Fees column or a new column. Postage and eBay fees go to different lines in Schedule C.
4. eBay should export Payout reports directly to Excel. Importing csv files requires special skills and data loss is possible.
5. eBay should tag item-specific income and fees with the Custom Label (SKU) to allow advanced users to tie the amounts to specific listings.

I wish that eBay paid as much attention to accounting for seller income and expenses as they do to extracting fees from sellers.

[99centstampsandmore]

eBay says " As Form 1099-K is an IRS information return, it includes the gross amount of all reportable payment transactions within a calendar year. This amount does not include any adjustments, for example, credits, discounts, fees, refunds, or any other adjustable amounts."

If it does not include fees then the eBays fees are not included in the gross?   So, if I sold a 50 dollar item charged 5.00 shipping and paid 5.00 ebay fee, my gross on the 1099 would be 45.? not the 55. I collected. and deducts the ebay fee? (50 for the item- don't include the 5 shipping and deduct ebay fee of 5.  45. gross receipt.)  So then I don't deducted shipping fees and eBay fees on my income tax. Right?

[nobody*s_perfect]

Try to ignore eBay's badly written statement.  The amount on the 1099-K includes every penny of buyer payments for item price, shipping and handling. Everything except what the buyer paid for sales tax (if any).  The total on the 109-K has NOT subtracted anything: Not fees, refunds, postage, etc.

If you sold a $50 item and charged $5 for shipping, then $55 will be added to your 1099-K.   Regardless of sales tax, fees, refunds, postage purchased, etc. Those are not factored-in.