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Bogus tax scheme from US government
I tried running this short diatribe through the AI assistant:
I was notified that my balance is frozen until I give eBay my social security number so that the US government can tax me for selling used items that I purchased with earnings already taxed once by the government, not to mention the sales tax I paid originally for the purchase of those items. eBay should provide a warning of this unscrupulous tax penalty BEFORE a seller reaches a $600 maximum. So here's my suggestion: apparently I've made $677.13 this year from sales on eBay. My current balance is $259.33. Let's say we round up my total earnings in 2023 to $678. I would then like you to subtract $79 from my current balance and pay out the remaining $180.33 to my bank account. That will put my total earnings below the $600 maximum, and you can keep the $79 for a company picnic or team-building outing. Then we can just let bygones be bygones. This dis-incentive will keep me from using eBay again. But I will have learned a good lesson. Thank you.
Any ideas how to get around this surprise stipulation?
cwmmoore
OP3 years agoThanks to everyone here who replied, and for setting me straight. OK, in the end, I get my money. No profits, just lightened my load of material belongings. Thank you.
Still, I have to share my SS with yet another institution, in this case a for-profit business. And yet another section to fill out on my tax forms. Ugh! It gets more and more complex around April every year.
Complaining done. I appreciate the responses and words of wisdom.
evry1nositswindy
Mentor3 years agoTake a look at a Schedule C. You can write off a lot of expenses. You pay tax on the profit (income). You might 'make'$700, but only have a profit of $200. This is what you declare as income. How much tax could that be? I really don't understand what the issue is with people worrying about this.
wooden_flower
Mentor3 years agoSelling used personal items is even easier - schedule 1 misc income, schedule 1 misc reduction to income. If you do happen to sell an item at a profit, use schedule D.
No schedule C required unless you are a business intending to make a profit.
wooden_flower
Mentor3 years agoNope, no way around it. If you do not provide your SS#, eBay would be forced to report the income to the IRS without the #, which will cost you a $50 penalty. You’ll still get a 1099k to deal with on your tax return. It isn’t a matter of what is paid out, it it the gross payments received on your account. Even refunding your buyers won’t make it go away.
You don’t get taxed on your sales, you get taxed on your profit. Since you’re selling your own used items, you probably did not make a profit. So all you need to do is document this, then you report a net of 0 on your tax return. Your tax prep don’t ware can instruct you on how to do this, or read up at irs.gov.
I am not a tax professional, and this is not intended as tax preparation advice. If in doubt, seek the advice of a professional tax preparer.