Question for tax time

[morgalexa-99]

Hi all 😀 I hope everyone had a great new years. I am new to selling on eBay and I was just curious if anyone had an answer to my questions regarding tax season. By any chance during tax season does ebay automatically send out a form for sellers for when we file taxes? Or is this something we figure out on our own? Just curious if anyone could guide me in the right direction for what I note for taxes and what forms I would need. Just wanna cover my bases. Thank you everyone 😀 

[dbfolks166mt]

     EBay has nothing to do with when you "file" your taxes. EBay potentially provides a 1099 that is used as part of your tax preparation process just like the other forms you receive, W-2, 1099-INT, SSA.......... If you have never filed taxes before you should probably talk to a tax advisor or utilize one of the tax preparation companies. Without knowing a lot of your personal information regarding your finances, which is not something you would want to post on a public forum, any advice or guidance would simply be guessing based on assumptions. 

     You can pull information regarding your 2023 tax year sales from the eBay reports to help you pull together your deductions. The other deductions and expenses will need to come from your own financial accounting records. 

[caldreamer]

EBAY has "easy to read" 1-page report which shows YTD totals for (orders, refund, EBAY fees, shipping expense).   You must file as a "business" if you want to deduct expenses (cost of goods sold, EBAY fees, returned merchandise, cost of shipping labels, mileage, packaging/office supplies, etc).   Anything used for your business is tax deductible.

Information you will need to give to your accountant:

- EBAY YTD Report (orders, refunded merchandise, EBAY fees, shipping expense).

- Misc. Expenses (keep receipt for cost of goods and other expenses)

- Beginning Inventory on Hand 1/1/2023 and Ending Inventory on Hand 12/31/2023 (you need to create spreadsheet to track all your inventory as it sells or when you add new inventory). 

You must report "gross sales" as shown on EBAY report (then subtract all your expenses on Schedule C).  You pay taxes on "net taxes" after all expenses are deducted.

If you have never filed "business taxes" before I strongly urge to consult with a tax professional.  They will help you to get every deduct and save you money. 

[janet9988]

Check with your state tax law for 1099 forms.

[mam98031]

You have reports that are available to you 24/7/365.  

Take your time with it, but play around with the reports available to you in your Seller Hub.

https://www.ebay.com/sh/fin/reportslanding

There is no form that Ebay sends out to all sellers as we aren't their employees.  But there is a form they send out if you sell above a certain threshold called a 1099K.

https://community.ebay.com/t5/Announcements/eBay-and-TaxAct-partner-to-help-you-navigate-new-Form-10...

https://www.irs.gov/faqs/small-business-self-employed-other-business/income-expenses/income-expenses

https://www.irs.gov/businesses/gig-economy-tax-center

https://pages.ebay.com/seller-center/service-and-payments/2022-changes-to-ebay-and-your-1099-k.html

https://www.irs.gov/pub/taxpros/fs-2022-41.pdf

[worldcoinauctions]

If you keep track of what you got from ebay over the year. That is your net. What ebay says you got paid is your gross. The difference is your expenses and shipping (assuming you buy your shipping through ebay.) Now that does not account for cost of goods, supplies, etc. Since I run a physical store I track that separately, also inventory.  A good idea to talk to someone about record keeping for your business!

[ckimodog]

@morgalexa-99 

Personally, I would ask a tax professional or accountant.  Not buyers and sellers on eBay.  I think that's where you could get the best answers to your questions. 

Happy New Year

[dbfolks166mt]

EBAY has "easy to read" 1-page report which shows YTD totals for (orders, refund, EBAY fees, shipping expense).   You must file as a "business" if you want to deduct expenses (cost of goods sold, EBAY fees, returned merchandise, cost of shipping labels, mileage, packaging/office supplies, etc).   Anything used for your business is tax deductible.

Information you will need to give to your accountant:

- EBAY YTD Report (orders, refunded merchandise, EBAY fees, shipping expense).

- Misc. Expenses (keep receipt for cost of goods and other expenses)

- Beginning Inventory on Hand 1/1/2023 and Ending Inventory on Hand 12/31/2023 (you need to create spreadsheet to track all your inventory as it sells or when you add new inventory). 

     Inventory is a question for the accountant most small businesses and sellers have no need to report inventory when filing taxes.

You must report "gross sales" as shown on EBAY report (then subtract all your expenses on Schedule C).  You pay taxes on "net taxes" after all expenses are deducted.

     They may or may not need to file a schedule C again a question for a tax professional .

If you have never filed "business taxes" before I strongly urge to consult with a tax professional.  They will help you to get every deduct and save you money. 

[luckythewinner]

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@morgalexa-99 wrote:

Hi all 😀 I hope everyone had a great new years. I am new to selling on eBay and I was just curious if anyone had an answer to my questions regarding tax season. By any chance during tax season does ebay automatically send out a form for sellers for when we file taxes? Or is this something we figure out on our own? Just curious if anyone could guide me in the right direction for what I note for taxes and what forms I would need. Just wanna cover my bases. Thank you everyone 😀 

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There is no way eBay could possibly know how you need to account for your eBay sales on your taxes.

And if eBay tried to give you tax advice, they would open themselves up to potential liability and risk.

Your taxes are entirely your responsibility.