Biden's Inflation Reduction Act
Since we are getting a new president, can we hope that the Reduction Act gets rid of the lower threshold to be taxed for our sales?
(Not a political post)
I only do about $5k and I hit the number already. Now I will have to pay taxes of items I sell.
This was a nice side gig, but not if I have to pay out for taxes.
79 comments
lux.ra_14
·1 year agoDeleted ...
mam98031
·1 year agoIt is extremely important that you understand, the FORM does NOT set the threshold for reporting your income. It never has. The 1099K is merely a FORM.
Forms do not set what income gets reported. There are like a dozen different types of 1099 forms. None of them set the threshold for reporting income. The 1099-int has a $10 threshold.
Myth: If taxpayers didn't receive a Form 1099-K, they don't have to report income.
Fact: According to federal law, all income is taxable unless it is specifically excluded by tax law. Taxpayers should report any profits from selling goods or services, regardless of if they receive a Form 1099-K.
https://www.irs.gov/newsroom/irs-never-mind-the-myths-know-the-facts-about-receiving-a-form-1099-k-i...
laperlalady
·1 year agoeBay sales (and any other income you have) is subject to income tax whether it is reported on a 1099-K or not.
sugarnspice777
·1 year agoYou will be happy to know that Trump is getting rid of the gig workers tax!
We will be going back to $20,000 like we should! A FACT!
Happy days are here again!!!
lux.ra_14
·1 year agoAnything to back that up?
gwenscupboard
·1 year ago"Gig" workers still have to report the income from the "Gig" work and pay taxes on it.
What part of that statement don't you understand?
doc-holmes
·1 year agoIf true, you should then be barred from using public services that require tax money to operate. Can't have it both ways.
dbfolks166mt
·1 year agoYou will be happy to know that Trump is getting rid of the gig workers tax!
We will be going back to $20,000 like we should! A FACT!
Happy days are here again!!!
Of course this will probably not happen for the 2024 tax year and in 2025 if it does change at the Federal level you will probably see a number of states passing their own 1099-K issuance requirements. Of course since those are a federal form their first stop is the IRS at the Federal level. I can think of four states that may set their own levels: CA, WA. OR and CO.
In addition any change at the Federal level will do nothing to change the state levels that are already codified into law.
chapeau-noir
·1 year agoDrink deep, my children...the potion works slowly.
dy60609
·1 year ago .......................
chapeau-noir
·1 year agoIt's a wonder there is any left. 😂
kensgiftshop
·1 year agoThat would be for receiving a 1099K.
1099K or not, you still report your income.
dbfolks166mt
·1 year agoThat would be for receiving a 1099K.
1099K or not, you still report your income.
As all those that have been posting and complaining have been doing for YEARS. I am quite sure every poster that has complained has reported every penny of their income on their taxes.
mam98031
·1 year agoThere is no such thing as "gig workers tax". So with no effort he can get rid of something that does not exist and take the credit for it @sugarnspice777 .
It is actually Income taxes on money earned.
thelongball
·1 year agoThis is all quite funny how every day someone is posting about how upset they are over the 1099's.
What they should be worried about is when they file their taxes and report it this year, and they get their audit letters from previous years where nothing was reported. All the IRS has to do it read their feedback to see that those other years, no sales were reported yet it shows they made sales. LOL - no wonder they say that they are hiring more agents at the IRS, they are going to need them.
fbusoni
·1 year agoNo offense, but if you think the IRS takes time to audit small fry eBay sellers and actually go through their feedback, you might not have a complete understanding of how revenue is collected by the feds.
bonanza125
·1 year ago@dbfolks166mt
Business owners and corporations always resist to give up after operating at a loss in many cases for years. My comment was directed towards smaller businesses who continue to try to sell online and still lose money year after year. They don't want to give up but in reality they should. Can't say force them cause they will do whatever they want to do but it's a waste of time and money. Sometimes it comes down to someone outside to tell them directly you need to close this business. You are making no money and things will not improve. It is hard for say someone small who works from home. Invests money in inventory which doesn't sell. Continue to pay store subscription and when something sells fees kill the profit.
dbfolks166mt
·1 year agoBusiness owners and corporations always resist to give up after operating at a loss in many cases for years. My comment was directed towards smaller businesses who continue to try to sell online and still lose money year after year. They don't want to give up but in reality they should. Can't say force them cause they will do whatever they want to do but it's a waste of time and money. Sometimes it comes down to someone outside to tell them directly you need to close this business. You are making no money and things will not improve. It is hard for say someone small who works from home. Invests money in inventory which doesn't sell. Continue to pay store subscription and when something sells fees kill the profit.
A lot of businesses and corporations are NOT resisting but are operating that way by design and intent. Amazon went YEARS before they ever paid any Federal Income Tax all the while increasing the value of the corporations right along with shareholder value. Tesla is currently operating in much the same manner as are Bank of America, Netflix, Nike............
The last part of your statement I will agree with. A lot of that is due to sellers not having a clear understanding of costs and/or knowing how to do accounting.
meme6253
·1 year agoThe two most certain things in life are death & taxes!
soh.maryl
·1 year agoNot sure if I'm interpreting your message correctly. Is eBay your only source of income?
Do you not pay Federal income tax on any other income?
If you have other sources, don't you add ALL of your income together when filing your tax return? Like: eBay: $5K; regular job, $50K; rental property, $6K?
simba6
·1 year agoHave you checked you share of the national debt ? It's about 160,000.00 dollars. If anything they are going to have to tax more.
They really have to rein in spending............
12345jamesstamps
·1 year agoSo it's ok to have tax haven countries for the very rich....Apple having their company money assets listed in Ireland so they pay almost nothing in taxes...a President elected has to show his income tax when elected but doesn't...sounds like the smartest people win at this...LOL
bonanza125
·1 year ago@monroe67
I am a seller and everything you said in regards to taxes I am fully aware of.
When it comes to side hustles and or folks who claim its for a hobby well income is still income. Still needs to be reported but I know a lot of people are trying to find ways around it or are just defiant. Those folks will eventually get caught.
chapeau-noir
·1 year agoWhile we muddle along until this great Golden Age (which according to Leon comes only after considerable pain to the non-billionaires) we are still a nation of laws. So pay the taxes on the profits. To pay taxes on personal items where you don't have receipts, just use the customary method of valuation by estimation. Don't worry, this is a common situation- I ran into it when I cleared several small estates.
Be sure you take ALL of your lawful deductions. Online tax software is inexpensive (and deductible). You'll probably end up owing little to nothing.
johnrj1226
·1 year agoSure glad I stayed awake in school and didn't have to depend on "The Team" to get passing grades
johnrj1226
·1 year agoYou only get taxed on the net income aka net profit before taxes after deducting all allowable deduction e.g. items acquisition cost, shipping cost, eBay fees, packaging materials, printing materials for shipping etc
bonanza125
·1 year agoYou are considered a business. You profit off the stuff you sell on Ebay and if you do on other sites as well. Nothing will change as far as acts.
You made a claim in a post. "I sell below the price I bought (at a loss) that shouldn't count as profit. How do I prove the price if I had it for a very long time?"
This is hard to believe that you as a seller are operating at a loss. In the governments eyes you are considered a business. If you are losing money then have a yard sale sell your stuff and close up shop. I don't want you to think I am sounding harsh here its just reality that as a business which is operating at a loss will just be sinking ship even more.
monroe67
·1 year ago"This is hard to believe that you as a seller are operating at a loss. In the governments eyes you are considered a business. If you are losing money then have a yard sale sell your stuff and close up shop. I don't want you to think I am sounding harsh here its just reality that as a business which is operating at a loss will just be sinking ship even more."
In the government's eyes, you are a taxpayer.
If you want to tell the IRS that the money you earn(ed) from eBay is purely as a hobby, the IRS will essentially say, "OK, fine. You must and you will pay income taxes on the full amount of money that you earned from your eBay sales." Hobby-selling taxpayers are not allowed to take any deductions for any expenses you pay for conducting that hobby. You don't get to deduct the cost of your packing materials, or mileage for driving to and from the post office, or the fees that you pay to eBay.
However, if you choose to tell the IRS that the money you earn(ed) from eBay is a business, the IRS will say to you, "OK, fine. Be sure to subtract all the allowable legal deductions to figure your taxable income from those sales, because you must and will pay income taxes on your taxable income."
So you (all eBay sellers) must choose what you want to do:
Pay income taxes on the full amount of your eBay earnings (selling as a "hobby") or
Pay income taxes on the amount of your eBay earnings less the allowable business deductions (selling as a "business").
Once you deduct the fees you pay to eBay, the cost of your mailing and packing supplies, mileage expenses for driving to and from the post office or driving to and from the store where you buy your packing supplies, you will probably have a smaller amount of taxable income.
IF your eBay sales are continuously "at a loss", then you will have no taxable income from those eBay sales.
That's bad if your eBay sales are your main source of income, but not-so-bad if your eBay sales are a side-hustle, extra activity in addition to your day job, or Social Security income, or passive income such as rents on property you might own.
You may have noticed this post does not mention Form 1099-K. THAT is because all US taxpayers are expected to list all their income on their 1040 tax return form (or appropriate version) regardless of whether the income-payer has to report it on Form 1099-K or not. If your earnings from eBay exceed a certain minimum amount, then eBay is required to send Form 1099-K to the IRS, to you, and possibly to your state's income-taxing authority.
dbfolks166mt
·1 year agoYou are considered a business. You profit off the stuff you sell on Ebay and if you do on other sites as well. Nothing will change as far as acts.
You made a claim in a post. "I sell below the price I bought (at a loss) that shouldn't count as profit. How do I prove the price if I had it for a very long time?"
This is hard to believe that you as a seller are operating at a loss. In the governments eyes you are considered a business. If you are losing money then have a yard sale sell your stuff and close up shop. I don't want you to think I am sounding harsh here its just reality that as a business which is operating at a loss will just be sinking ship even more.
There is a LOT more to your statement regarding businesses operating at a loss. Many are doing just that and are FAR from being a "sinking ship". A lot of businesses and corporations may look like a sinking ship on paper and their tax filings but are in fact a juggernaut.
The major difference is corporations and the rich hire legal experts who know how to leverage the tax laws so they pay little to no income tax.
gone.c-33
·1 year agoThe new president’s going to need money for all the ordnance he want to send to the Middle East…
caldreamer
·1 year agoThis is not answer to your question just an observation. You could be losing money by selling items for only $1. EBAY selling fees based on total sale ($1 item + $1.25 shipping + .22 sales tax = $2.47) plus 30 cent handling charge.
You would have more profit if lump several items together to bring your sales price up.
dbfolks166mt
·1 year agoAs others noted you are responsible to pay taxes on revenue regardless. With regards to any possible change to the 1099-K issuance threshold that is a TBD and nothing will likely happen for the 2024 tax year unless the IRS delays the $600 limit again. Even if the IRS delays it at the Federal level it will have no impact on the already established individual state issuance thresholds. Maybe it is just by coincidence that most of the states that have already established lower 1099-K issuance levels are primarily blue.
Even if the level is changed at the Federal level I would not be surprised to see individual states pass their own laws in 2025. I am frankly surprised CA has not already done so.
jerseyboymusic
·1 year agoI'm so tired of these posts on this subject
ANY income is income... business. hobby, etc. You sell your car on FB Mkt, that's income. Have a yard sale, that's income. Make $50 for the year on Ebay, that's income. You report it to the IRS, 1099 or not
albertabrightalberta
·1 year agoSo you're saying you haven't been reporting in the past?
The requirement to report your earnings hasn't changed! You should have been reporting all along.
stuff4divas
·1 year agohere we go again, another tax evader, trying to figure out how to beat the system, yet still reap it's benefits 🙄
fbusoni
·1 year agoGo to YouTube and search on "sovereign citizen" for an unforgettably hilarious close up view.
stuff4divas
·1 year agoHa Ha!! I've seen some YouTube videos of police arresting people for criminal acts and they start shouting
"I'm a sovereign citizen!! Those laws don't pertain to me!!"
But in the meantime, they reap benefits America has to offer without making contributions
fbusoni
·1 year agoYes, we have a mental health crisis in this country of staggering proportions.
deltiologist
·1 year ago@fugazi
Carter presided over the absolute worst presidencies and had one of the worst economies in modern history and an even worse approval rating. The people couldn't wait to be gone with him. So, I wouldn't go "boasting" too much about the blight on your resume.
fbusoni
·1 year ago@the.straggler
Thanks for the history lesson... but other than being triggered by the name "Jimmy Carter," what does the powerful insight above have to do with what I wrote?
Would you have understood the point if I said I started my career when Warren Harding was President? 😅
wastingtime101
·1 year agoThere is no lower threshold for when sellers are or aren't taxed.
The lower threshold is for when a 1099-K form is required.
When a 1099-K is not issued, that doesn't mean the seller doesn't have to report eBay sales on their income tax filings.
Refer to irs.gov for tax year 2024 filing thresholds.
Individual states may have different thresholds for state filings.
cund.mich
OP1 year agoThis is what I was referring to. The 1099-K.
wastingtime101
·1 year agoRight, and that doesn't change my answer. The 1099-K is not the determining factor in whether or not you have to report your income. You may stay under the 1099-K threshold and still have to report your income.
I suggest researching reporting thresholds for 2024 with the IRS and your state, and consult an accountant if you have questions about whether you're required to report your earnings or not.
Edited for clarity.
kensgiftshop
·1 year agoDoesn't matter if you get a 1099K or not, you're still supposed to be reporting your income.
Tax dodgers haven't been doing it, so now it'll be harder for them to hide their extra income.
dy60609
·1 year agoThat is so clearly not what you were referring to when you made the statement in your opening post
----------------------------------------------------
to quote:
Since we are getting a new president, can we hope that the Reduction Act gets rid of the lower threshold to be taxed for our sales?
fbusoni
·1 year agoI hope not. We are a nation of laws. Paying tax on earned income is one.
I'm really curious why one would be reluctant to do so, as that mindset is completely alien to me.
deltiologist
·1 year agoIt shouldn't be your mindset; income tax supports big, bloated government. Income tax as we know it was enacted in 1913 and has grown into a big, ugly beast.
As heads of the newly created Office of Government Efficiency, Elon Musk and Vivek Ramaswamy are about to take a chainsaw and gut the beast.
The Don is going to implement a new tariff system, pre-Military Industrial Complex, as we enter The Golden Age of Prosperity. Our country was once prosperous without severely levying the populace.
Get ready to be happy, as more money in our pockets encourages economic growth: buying homes, opening businesses, etc.
We, the USA, are getting out of the business of war, which the MIC fears so much, and getting into the business of wealth & prosperity.
As it relates to eBay and the topic at hand, we're all going to win. Follow the rules as they're currently set, and prepare for the windfall next year.
dnasilver
·1 year agoThe "golden age prosperity" was great for the rich but 90 plus % of the population suffered.
chariot_badges
·1 year ago110% agree.
Take this next year to purchase quality inventory at fire-sale prices.
Expand your data base.
Get the store all cleaned up and running like a Rolls Royce v12 and get ready.
You'll be the ONE that everyone is looking at saying "how lucky he is to have sales and inventory like that."
Luck.
meme6253
·1 year agoI think this should be posted again in 6-8 months & we can talk about this New Golden Age, until then it is very pre-mature.
fern*wood
·1 year agoHave you actually seen what's on the wish list of cuts?
chapeau-noir
·1 year agoThe drunken fever dreams have already started. 🥵
gone.c-33
·1 year agoAwww the good old trickle down economics…
fbusoni
·1 year agoYeah, thanks. Please don't tell me what my mindset should be.
And please don't lecture me about politics. I spent a 40 year career with the executive branch across every administration, starting with that of Jimmy Carter.
We are a nation of laws. And until those laws are changed, we need to uphold them.
Meantime, this made me laugh out loud:
As heads of the newly created Office of Government Efficiency, Elon Musk and Vivek Ramaswamy are about to take a chainsaw and gut the beast.
Because it shows how little you actually know about how things work in DC.
For starters, it would be a cinch to create an Office of Government Efficiency... if the government was efficient to start with.
I'll stop there.
meme6253
·1 year agoThis so called Golden Age, Have you ever heard of fools gold?
doc-holmes
·1 year agoIt seems rather inefficient to have two heads of the Office of Government Efficiency. Sounds like a Monty Python sketch.
deltiologist
·1 year agoElon is the richest person in the world and Vivek is worth over 1 billion usd, I think we'll take their advice versus...
gone.c-33
·1 year agoAnd Twitter lost between 65 and 80% of its value and thousands of advertising contracts and and since being bought out, and brand perception is abysmal.
That’s not great performance indicators for the CEO of a company, let alone an entire country.
fbusoni
·1 year ago@deltiologist
Thanks for the laugh.
I suspect that the two aforementioned clowns will be making a premature and hasty egress once they discover that there is no Congressional support for the endeavor with which they have been tasked.
One does not declare, "I hereby establish a Department of Government Efficiency!" and POOF, it's created.
Especially when the objective is to CUT government spending, not increase it.
You think it's accidental that Musk is begging for applicants to this imaginary bureaucracy on X, and offering no compensation for an 80 hour week? And that the ONLY applicants he will interview are those with a premium X subscription (or whatever that waste of money is called these days)?
Kudos to Mr. Trump's advisors for exploiting the egos of the two above-mentioned imbeciles and ultimately marginalizing them.
Hopefully more will be dropping like flies in the weeks ahead as the need for Mr. Trump to throw nonsensical red meat to his base eases with the passage of time.
mam98031
·1 year ago@fbusoni
A government office can't be created just because 3 rich people want it to exist. Congress has to create the new department.
That name just keeps me laughing. Department of Government Efficiency. Elon wants it pronounced as DOGE' [d o gee] but to me it says dog.
gone.c-33
·1 year agoDoge coin began as a joke cryptocurrency that Musk is obsessed with. Naming a government office after a crypto he profits off of sounds dodgy (dogdy?) to me at best…
meme6253
·1 year agoI would have paid $10 for a dozen of eggs or not bought them at all, Instead of what we are going to get!
dy60609
·1 year agoFor any credibility you need to choose another product.
The cost of a dozen eggs was not the result of any government action or government inaction.
Egg prices were the result of a product shortage due to all the dead chickens.
meme6253
·1 year agoPaying tax on earned income is one, I think the president elect should be reminded of that
12345jamesstamps
·1 year agoDoesn't a president going in office have to show his income tax statement?....This would make it 8 years counting and we will still be waiting...LOL
meme6253
·1 year agoIt's pretty amazing that the rule of law does not actually apply to everyone.
soh.maryl
·1 year agoJust curious: which rule of law does not actually apply to everyone?
Are you referring to Federal law like the income tax?
lux.ra_14
·1 year agoHow about the one where a serial offender faces no consequences after being convicted by a jury of 34 felonies?
meme6253
·1 year agoAmazing isn't it!, He gets a get out of jail free card, Talk about rigged.
meme6253
·1 year agoYes paying income tax
luckythewinner
·1 year agocan we hope that the Reduction Act gets rid of the lower threshold to be taxed for our sales?
There is no "lower threshold to be taxed for your sales". There is simply a lower threshold for eBay to reporting your payments processed from your eBay activity on a 1099-K form. Your eBay activity is subject to income tax whether it is reported on a 1099-K or not.
I only do about $5k and I hit the number already. Now I will have to pay taxes of items I sell.
You can pay taxes on all the income from your sales if you choose to, but if you take your allowed deductions then you only have to pay taxes on the profits after costs and expenses.
That means you can deduct the cost of the items, the postage you paid to ship them, the shipping supplies that you bought, and the fees you paid to eBay.
And don't forget you can usually deduct mileage on your car when it is used for eBay purposes, and you can take the simplified home office deduction if you have a dedicated space used for eBay sales.
cund.mich
OP1 year agoI do not have this set up as a business. Maybe I should?
I sell/flip some items, But I also have been holding onto cards/collections and figures/toys/trains for a very long time. And if I sell below the price I bought (at a loss) that shouldn't count as profit. How do I prove the price if I had it for a very long time?
You don't need to be set up as a business.
You also don't need a 1099 to declare your earnings from eBay.
If you earned $1.00 selling on eBay you should be declaring it on your taxes as income. Whether your income earned on eBay is taxable is something you need to talk with a tax preparer about.
Not declaring your earned income from sales on eBay is called tax evasion.
albertabrightalberta
·1 year agoALL income should be reported.
If you're a "hobby seller," you report the full payments received as income and cannot deduct your costs.
If you're a "business seller," you still report the full payments received but can deduct your costs.
wastingtime101
·1 year agoDo you have no records of those old purchases? Receipts, emails, credit card or bank charges, etc?
luckythewinner
·1 year agoThe IRS has a whole publication explaining how to account for 1099-K income.
https://www.irs.gov/businesses/what-to-do-with-form-1099-k
For personal items items sold at a loss, see the section titled "Personal items sold at a loss".
For personal items items sold at a gain, see the section titled "Personal items sold at a gain".
For items you bought in order to flip, that sure sounds like a business to me.
monroe67
·1 year ago"The IRS has a whole publication explaining how to account for 1099-K income.
https://www.irs.gov/businesses/what-to-do-with-form-1099-k "
Thank you, Lucky !!!
This should be the standard response to all future outrage-posts about eBay's 1099-K reporting.
I opened the link and found that the page was last reviewed or updated on the 12th of November, 2024, so it is very recent.
It also gives a lot more info as to whether a seller's activity could or should be considered a hobby or a business.
Very Helpful !!