Hello, regarding this new year 2025 how much sellers can sell before receiving a 1099 tax form?
Hello, regarding this new year 2025 how much sellers can sell before receiving a 1099 tax form?
17 comments
Hello, regarding this new year 2025 how much sellers can sell before receiving a 1099 tax form?
mam98031
·1 year ago@mj455
https://community.ebay.com/t5/Announcements/IRS-confirms-5-000-reporting-threshold-for-Form-1099-K-for-tax/ba-p/34814816
It is also so important to remember that ALL income has to be reported to the IRS. This 1099k is ONLY a FORM and nothing more than a form. It does not now nor has it ever set a threshold of when you have to report your income. With or without a 1099k, you are suppose to report your income.
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-in-2024
kensgiftshop
·1 year agoDoes it really matter if you receive a 1099K or not?
You still report your income.
@mj455
You mean the threshold for eBay to report your earnings to the IRS? It's $600 this year I think, I could be wrong as it changes often.
But it really doesn't matter, you need to declare your earnings from eBay sales regardless of whether or not your sales meet the threshold.
monroe67
·1 year ago"It's $600 this year I think, I could be wrong as it changes often."
Oh, no.
Yes, you are mistaken about the $600 threshold for "this year", by which I hope you mean 2024.
The IRS issued what they call "guidance" that specified these reporting thresholds on Tuesday, November 26, 2024.
For tax year 2024, eBay's 1099-K federal (IRS) reporting threshold is $5,000 in gross sales.
For tax year 2025, eBay's 1099-K federal (IRS) reporting threshold will be $2,500 in gross sales.
For tax years beginning with 2026, eBay's 1099-K federal (IRS) reporting threshold will be $600 in gross sales.
For all tax years since eBay has been required to issue Forms 1099-K, for sellers who reside in a state with a lower reporting requirement than the federal (IRS) level, eBay has and will issue a Form 1099-K to those sellers.
As for these threshold requirements "chang[ing] often": How do you define often? Once a quarter? Once a month?
For the last few years, the IRS has issued A (one) final statement of the 1099-K reporting thresholds late in the year of each report.
As I recall, in 2022, that announcement came on or around December 23, 2022, only eight (8) days before the end of the year. Not being a programmer myself, I sure hope this late announcement did not disturb too many programmers' holidays.
In 2023, the announcement came late in November of 2023. And, as mentioned above, the announcement of the 2024 reporting threshold was published on November 26, 2024.
None of this info requires a back-hoe or jackhammers to discover.
Maybe it's just more fun to repeat something you read or overheard.
jbbowers12012
·1 year agoHi, We here in New Jersey always report our eBay earnings as income. No matter how large or small. I THINK that it is an IRS requirement. I hope that we havent' been messing up.............. (J.B.)
monroe67
·1 year ago"We here in New Jersey always report our eBay earnings as income. No matter how large or small. I THINK that it is an IRS requirement."
I think you're right !!!
. . . That the IRS requires you (and me and all US federal income taxpayers) to report
. . . on our federal income tax return, Form 1040 or the version that is appropriate for each of us
. . . all our income from each and every source
. . . whether or not we have received a 1099-K from eBay, from Air BNB, from Uber or from any other required income reporter.
I also think that some confusion arises among people who might receive a 1099-K from eBay (or other organizations) because many people don't realize that the 1099-K is a requirement for eBay (etc.).
eBay must issue Form 1099-K to all eBay sellers who have earned at least $5,000 in gross sales during 2024.
eBay sellers will receive a Form 1099-K for 2024 when they have met/exceeded the $5,000 gross sale threshold.
Perhaps another way for eBay sellers to look at the whole subject of Form 1099-K is that the 1099-K actually helps the people who receive it. It will be a great time-saver when it comes time to fill in Form 1040 tax return forms and the schedules that can be filed with it. They can rely on the 1099-K to tell them the exact dollar amount of their eBay sales during the taxable year.
Those of us who do not receive a Form 1099-K from eBay must go into our Seller Hub and look up our eBay year-end totals. We might even print them out. So much extra work!! What a nightmare!! (irony)
dbfolks166mt
·1 year ago"It's $600 this year I think, I could be wrong as it changes often."
Oh, no.
Yes, you are mistaken about the $600 threshold for "this year", by which I hope you mean 2024.
Actually @ebooksdiva is correct at least for the state I live in. It has been $600 in Virginia since 2020.
The IRS issued what they call "guidance" that specified these reporting thresholds on Tuesday, November 26, 2024.
For tax year 2024, eBay's 1099-K federal (IRS) reporting threshold is $5,000 in gross sales.
Better stated since it includes "Federal (IRS)".
For tax year 2025, eBay's 1099-K federal (IRS) reporting threshold will be $2,500 in gross sales.
That may depend on what may happen at the Federal level and/or any other states that choose to set their own lower 1099-K issuance thresholds. This early in the calendar year I would not bet on anything remaining the same for the whole year.
For tax years beginning with 2026, eBay's 1099-K federal (IRS) reporting threshold will be $600 in gross sales.
For all tax years since eBay has been required to issue Forms 1099-K, for sellers who reside in a state with a lower reporting requirement than the federal (IRS) level, eBay has and will issue a Form 1099-K to those sellers.
As for these threshold requirements "chang[ing] often": How do you define often? Once a quarter? Once a month?
For the last few years, the IRS has issued A (one) final statement of the 1099-K reporting thresholds late in the year of each report.
As I recall, in 2022, that announcement came on or around December 23, 2022, only eight (8) days before the end of the year. Not being a programmer myself, I sure hope this late announcement did not disturb too many programmers' holidays.
In 2023, the announcement came late in November of 2023. And, as mentioned above, the announcement of the 2024 reporting threshold was published on November 26, 2024.
None of this info requires a back-hoe or jackhammers to discover.
Maybe it's just more fun to repeat something you read or overheard. Agreed, or to simply check the other 100's of postings on the same subject.
rusty1234russell
·1 year agoThis isn’t true and I hear it alot . eBay has been fighting for the seller to not be 1099 for their sales on eBay. The battle to make eBay sellers pay taxes has been an ongoing issue between the IRS and e-commerce businesses. eBay itself has put out constant emails on their site stating they have found the fight to keep the threshold higher and really not requiried by law. So to state you must pay even if you are not 1099ed is false and eBay talks about this issue all the time. I’m sure you will still disagree but getting 1099ed has been a constant battle between e-commerce companies and the irs for a long time.
jg.mason
·1 year agoI think you should read post #7 in this thread. You are required to report your eBay income, even if you don't receive a 1099.
monroe67
·1 year ago"eBay itself has put out constant emails on their site stating they have found the fight to keep the threshold higher and really not requiried by law. So to state you must pay even if you are not 1099ed is false and eBay talks about this issue all the time. I’m sure you will still disagree but getting 1099ed has been a constant battle between e-commerce companies and the irs for a long time. "
In eBay's December 9, 2024, Announcement to sellers states, at the end of it:
[Start of eBay Quote] "Disclaimers:
eBay and its affiliates do not provide legal, tax, or accounting advice. This material is being provided for informational purposes only and is not intended as, and should not be relied upon for, legal, tax, accounting, or other professional advice. Please consult your own legal, tax, and accounting advisors for advice specific to your situation." [End of eBay Quote]
Personally, I really don't care what you list or don't list on your Form 1040 tax return or if you complete possible Schedules or Attachments. After all, what difference could one more tax cheater make in our current national situation?
Ooh, I do know the answer to that one!! Too many tax cheaters will mean stricter tax laws for those of us who do NOT cheat on our federal income taxes!!
"Too many tax cheaters" are specifically the reason why Third Party Service Organizations (TPSOs) like eBay are now, in fact, required by law to tell the IRS the names, addresses, and Social Security numbers of every seller to whom they paid out money for selling on their platforms. The method for eBay and other TPSOs to tell the IRS your name etc. is through Form 1099-K.
I couldn't help but notice your profile picture. You might want to take a quick read-through of the Gospel of St. Matthew 22:20-22 and/or the Gospel of St. Mark 12:17. Those are the "Render Unto Caesar" statements made by Jesus.
rusty1234russell
·1 year agoActually after investigating further you are right. I guess the question remains than is it worth it to sell on eBay where a seller like me who is very small and after you add up the sellers fees, cost of goods, shipping materials running to the post office you practically are either braking even or a slight gain at most. I work full time so after I pay a tax preparer to add and subtract this all up and add the 1099k to my taxes and it has no effect on the taxes that I already pay yearly to the IRS it is a legitimate question. I could see if you are a corporate seller or a full time seller who’s in it for profit but I think if you do it as a hobby and you do it more for the enjoyment of it you should probably relax a little on it. That’s my opinion on the whole reporting of the 1099k. My selling on here will not move my tax reporting bracket one way or another. It will have no barring on what I already pay to the IRS on a yearly basis like I was saying
monroe67
·1 year ago"Actually after investigating further you are right."
Finally !! The Validation I Have Been Searching For !! (irony)
"I could see if you are a corporate seller or a full time seller who’s in it for profit but I think if you do it as a hobby and you do it more for the enjoyment of it you should probably relax a little on it."
Oh, the IRS has accounted for hobby-sellers. You will just find the appropriate line on your Form 1040 tax return, and fill in the amount you got as income from your hobby. You also won't be allowed to take any deductions such as, as you stated, "the sellers fees, cost of goods, shipping materials running to the post office." ("Running" isn't deductible anyway; mileage for driving is. But hobbyist sellers don't even get to deduct mileage for driving to the post office.)
Individual sellers here on eBay have as much variety in their motivations for listing and selling as they have in the items they want to sell on eBay. Each person who wants to sell on eBay (Etsy, Poshmark, Reverb, etc., etc.) should really know what they're getting into on their chosen platform and make informed decisions on whether "it is worth it to sell on eBay" (or Etsy, Poshmark, Reverb, etc., etc.)
Not to mention that your federal income tax situation is probably not identical to that of any other person who responded to your post. Even eBay itself suggests that sellers consult with professional tax preparers. BTW, I've had good results with H&R Block.
slippinjimmy
·1 year agoOf course they fought it, they new exactly what would happen if it was implemented.....some sellers would freak out and give up selling or at least give up selling via marketplaces. This would cost eBay MONEY so they opposed it. Do you think eBay really cares about the tax liability of anyone other than eBay Inc.
roccotacodad54
·1 year agoGo ahead and tell that to the IRS. LOL.
nobody*s_perfect
·1 year agoYou are wrong, as was pointed out in detail by monroe:
"The IRS issued what they call "guidance" that specified these reporting thresholds on Tuesday, November 26, 2024.
For tax year 2024, eBay's 1099-K federal (IRS) reporting threshold is $5,000 in gross sales.
For tax year 2025, eBay's 1099-K federal (IRS) reporting threshold will be $2,500 in gross sales.
For tax years beginning with 2026, eBay's 1099-K federal (IRS) reporting threshold will be $600 in gross sales."
Here's a link to that IRS announcement from November; you can also see a summary of it in eBay's Announcements, belatedly published on December 9.
https://www.irs.gov/newsroom/irs-provides-transition-relief-for-third-party-settlement-organizations-form-1099-k-threshold-is-5000-for-calendar-year-2024
Furthermore, all of the above discussion of 1099-K thresholds is moot if the seller lives in one of the 6 or 8 states which have already set thresholds that are much lower than the federal level; my own state has had a $600 threshold since 2018.
I know that my post is mostly redundant, but I feel it is necessary because the original poster, @mj455 , chose a post with erroneous information as the 'Best answer" for this topic, and they should come back and undo that.
mj455
OP1 year agoHow do i undo "Best Answer" as i accidently clicked on it.
monica-sells
·1 year agoIt depends on what state you reside in as to what the requirements are for reaching the 1099-K threshold. The Federal level for 2024 is 5,000