NEW TAX ON SELLERS

[anotherman_87]

WHAT'S THE LATEST ON THE PUSH BACK AGAINST THE UNFAIR AND OVER THE TOP NEW TAX LAW TO REPORT $600 A YEAR , THAT'S LIKE $ 1.66 A DAY IN SALES..FOR REAL

[mrsbmcv77]

If you don't really do much in sales, like me, it's a hassle.  I can tell you how it will go though.  My state inacted a $1200 limit last year.  Okay, so for the $1800 I did, I had to fill out self employment tax forms.  It was more costly to file and showed a LOSS of $1100.  Legitimately, I keep all my receipts and fudged nothing.  

My concern is if I have to keep filing at a loss.  It used to be, and to my knowledge this did not change, that you could only claim a loss on a business for 3 years in a row before it became a "hobby" and therefore not part of your tax filings.  I guess I will be fudging to make it appear that I made a profit, since the 1099's will keep coming.  

[onefootflipper]

---

@mrsbmcv77 wrote:

If you don't really do much in sales, like me, it's a hassle.  I can tell you how it will go though.  My state inacted a $1200 limit last year.  Okay, so for the $1800 I did, I had to fill out self employment tax forms.  It was more costly to file and showed a LOSS of $1100.  Legitimately, I keep all my receipts and fudged nothing.  

My concern is if I have to keep filing at a loss.  It used to be, and to my knowledge this did not change, that you could only claim a loss on a business for 3 years in a row before it became a "hobby" and therefore not part of your tax filings.  I guess I will be fudging to make it appear that I made a profit, since the 1099's will keep coming.  

---

Probably really easy to balance it out to a tiny profit by just not claiming various things if needed. 

[laperlalady]

New tax?  No. 

$20,000 was the level at which payment processors were required by law to issue a 1099K.  If less than that they were not required to send a 1099K.

You are/were still expected to report your earnings to the IRS.

Sounds like you have not been reporting?

[onefootflipper]

Just going out on a limb here, but I am betting the percentage of ebay sellers who didn't have other business income and did less than $20,000 worth of business who were filling out schedule C was probably in the low single digits. I don't personally know a single person who did, and I have talked to a huge number of people in the real world who stopped selling online because of reporting.

It never actually came up for me, I went from occasional seller of a few hundred dollars a year directly to way past $20K with no years in between those extremes.

[janet9988]

---

@gamersbaystore wrote:

There is no income tax due on items you bought and resold at a loss, that is my point. There is no logic to requiring people to keep track of sales for a lousy $600 either. The reporting requirements and tax laws changed, that makes it a new tax.

---

So if I get paid less than minimum wage I don't need to report anything because I am losing money?

[7606dennis]

Actually, the amount of taxable income the seller is required to report has not changed.  The only thing that has changed is minimum dollar amount at which the payment processing institution is required to send a 1099k. 

[coolections]

Hopefully almost all sellers who are just doing this for a a hobby will deduct very single dime of that income and not pay a penny. I would love to see those who came up with this crazy scheme to be so overburdened by paperwork it will cost them billions in the long run and not get a penny.

[7606dennis]

---

@coolections wrote:

Hopefully almost all sellers who are just doing this for a a hobby will deduct very single dime of that income and not pay a penny. I would love to see those who came up with this crazy scheme to be so overburdened by paperwork it will cost them billions in the long run and not get a penny.

---

You do realize that only business sellers can take business deductions.  Right?

[mcastiglione]

I'm not against paying taxes, but this is horribly wrong. My Father passed away and left many sellable items that he already paid tax on when he bought them. So it's true, we have to pay double taxation.  Tax when the item is bought and more tax when the item is sold later. The thing that borhers me though, I shouldn't have to register as a business when I sell more than $600. It's ridiculous 

[maxine*j]

---

@gamersbaystore wrote:

Its not income if you owe no taxes to begin with.

---

That's not quite right.  Income and tax on that income are separate issues.  Your obligation is to report your income, and you do that with accompanying forms and paperwork that determine whether tax is due on that income and in what amount.  This is for both federal and state income taxes.

It is true that some people do not have to file income tax returns at all, or they may have to file a state return but not a federal one, or vice versa.  Getting the 1099 from eBay will not change that. 

It is true that different people may have income in different amounts and from different sources before having to file and / or having to pay tax on those amounts.  Getting the 1099 from eBay will not change that.

No two people are in exactly the same tax situation, and so no one should take advice from on-line chats, even though the advice may be accurate insofar as it goes  and is well-intentioned.

-

[bonjourami]

"I'm not against paying taxes, but this is horribly wrong. My Father passed away and left many sellable items that he already paid tax on when he bought them. So it's true, we have to pay double taxation.  Tax when the item is bought and more tax when the item is sold later. The thing that borhers me though, I shouldn't have to register as a business when I sell more than $600. It's ridiculous"

Thats just not correct, your father paid state tax when he bought the item, you are required to pay Federal tax when you sell that item. And taxes should be paid on any sales you have, its the law, and has been for a long,long, time.. 

[dogofwar777]

Another reason I stopped selling here.

[maxine*j]

---

@gamersbaystore wrote:

I made it perfectly clear I run a business here, did I not? My argument is in defense of those who dont.

And yes, ebay is just a part time business for me, and I do pay taxes on it. I have another job. I worked 3 jobs last year, and my store was closed for the majority of this year due to being burnt out.

---

I understand where you're coming from, thinking in terms of people who sell a few odds and ends on eBay and you belives getting the 1099 may create a hassle for them for no particular reason because they may not even have to file tax returns and, if they do, probably owe nothing on their eBay sales.

But, really, nothing has changed for most of them just because they get a 1099.   If they have doubts or problems, there are tax volunteers all across the U.S. who help people file returns, and do it for free.  They are set up to help folks with lower incomes but, in fact, they'll help anyone who comes through the door.

What we see a lot here, on these forums, are people who have been selling on eBay for many years, have thousands of sales, sell things for substantial amounts, have multiples of brand new items listed -- and try to tell us they're just poor old windows and widowers, usually disabled and veterans to boot, who are trying to put food on the table by selling off their personal possessions. 

Baloney!  If those are their personal possessions then (a) they live in homes the size of an Amazon warehouse and (b) their dispoable incomes were enormous to have bought that many consumer goods and (c) they may need to talk to a psychiatrist about why they bought 127 identical leather photo albums, 42 identical vacuum cleaner filters, and 212 boxes of #2 envelopes, and never opened any of it.

For years and years such sellers had an unfair advantage over sellers who played it straight, tax-wise, so there's not much sympathy for them now that the jig is up.

-

[maxine*j]

---

@johnrj1226 wrote:

Have  garages sales and your  life will be good again.

---

Around here, you can get the borough's permit (free)  for two garage sales a year.  More than that, and they know you're a business and start dealing with you accordingly.

-

[soh.maryl]

The state sales tax is charged on the transaction, not the item.