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Why am i being taxed on service i do not provide
Ebay is putting the shipping on our selling total im not the shipping company either ebay needs to be responsible or the shipping company and im about to file a real legal dispute against ebay this is **bleep** never mattered until the irs threshold change it should have never been happening in the first place
9 comments
lady_madonna
Mentor3 years ago@holditwfo
Your gross sales includes the total amount the buyers pay you which includes your shipping charges.
When you file your taxes you can deduct all your expenses, such as shipping costs, Ebay fees, packing materials, etc.
You should always report all of your income, regardless of any reporting by Ebay.
holditwfo
OP3 years agoI am not the shipping company maybe you need to separate that as a separate part of a purchase how am i getting paid for shipping when it goes straight to a label that we are made to purchase seems like were being forced into it and it raises our tax liability bigtime that not at all acceptable
wooden_flower
Mentor3 years agoEdited reply.
Even when you charge the buyer the exact amount for shipping, the shipping payment comes to you. That makes it reportable revenue.
You deduct your actual shipping expense as one of your costs to arrive at taxable income, so in the end only your profit, if any, on the shipping becomes taxable income.
dryophelia
Mentor3 years ago@holditwfo
There is no tax on shipping nor the sales tax the buyer pays.
eBay based their fees on the entire amount processed. Item price, shipping and sales tax paid by the buyer. How you fund shipping is up to you.
These fees are a deduction on your taxes.
mam98031
Mentor3 years agoI think I know what you are trying to say, but what you actually typed didn't quite make your point.
There IS tax on shipping for buyers located in a state that requires a state sales tax on shipping. And yes the Buyer does pay for any and all Sales Tax. However the seller will pay a FVF on that total amount to include sales tax.
mam98031
Mentor3 years agoNot is a law suit in the making. Most are simply because we don't understand something or are not aware of somthing. In this case, you just seem to be unaware of a few things.
Ebay is required by law to collect and remit sales tax for most of the states. Some states charge sales tax on the shipping amount you charge to the buyer. Below is a chart showing which states charge this and which ones don't.
This has NOTHING to do with the IRS, that is federal. You are talking about STATE level sales tax. As for the Threshold on the 1099Ks, Ebay had nothing to do with that, that was the IRS and the Congress.
holditwfo
OP3 years agoNo you dont get it how am i getting paid for shipping the shipping co is getting paid not me im only selling the item im only providing the item and a way to the shipping co i just dont think shipping costs should be a part of our gross income when its not and income the only income is for my item its not my fault that someone lives more than driving distance from my location but i dont own stock in shipping its not my business its separate
mam98031
Mentor3 years agoI do get it and I assure you I understand the issue. On the seller's end, you do NOT pay taxes on shipping you charge your buyer if you are only charging them exactly what you pay for shipping. Before any seller pays taxes on the income they earn on Ebay you deduct your expenses, one of those is shipping costs, then after deducting all your costs you arrive at your Taxable Income.
Now you charge the exact amount you pay for shipping, but likely sometime you have been wrong and you paid more or a little less. Lots of sellers charge a handling charge and that is included in what they charge for shipping and there is nothing wrong with that. A handling charge is meant to help cover shipping supplies and fees paid on shipping.
There is no need to worry about your Gross Income as you will never pay taxes on that amount unless you made a mistake, then you need to go back and file a revised tax return so you can deduct your expenses like refunds, shipping, selling fees, cost of the product, etc.
Sellers do not pay Sales Tax. That is a state tax and it is paid by the buyer.
holditwfo
OP3 years agoIm not unaware thats why im here im only selling the item or items im selling im not selling shipping or i would have to have a stake in the shipping co which i do not they are a completely separate entity and should not be included in my gross sales total i didnt sell shipping only my item it not my fault the buyer isnt within walking distance