How much can I sell without adding it to my income taxes?
How much can I sell per year without adding it to my income taxes?
I live in Minnesota, if that matters.
33 comments
How much can I sell per year without adding it to my income taxes?
I live in Minnesota, if that matters.
slightlady
·2 years agoIf you are actively running a home business you can take mileage, a % of home expense and costs to sell off your gross income. I am retired so not high income but I have never paid in Federal because I sell on line and have done so for years. You should be showing some + income some years but it does not have to be huge. Talk to your Tax Person. I always have a bunch of miles from looking for items to sell. I can go an easy 100 miles a day if I spend the day look between towns for resale items. Helps to have a Car which gets over 50 MPG most times of the year.
monster-deals
·2 years ago$0.00
luckythewinner
·2 years agoThe IRS and States have a minimum a threshold for whether eBay has to use a 1099-K to report payments you have received.
But that is a threshold for whether eBay has to report payments made to you, not whether you have to report income. As far as I know, the IRS does not have any minimum threshold for reporting income.
gloryglorygifts
·2 years agoOf course the IRS has a minimum for filing. (Unless your sole income is social security/Social security disability)
Guide to filing your taxes in 2024
jthole
OP2 years agoWhat is the sales threshold for ebay to mail out the 1099-k form? In Florida, where my brother lives, he receieves a form 1099-k from ebay if or when his sales go over 20K. But what is the sales threshold for my state, Minnesota? I have been unable to find the information online.
monica-sells
·2 years agoA 1099-K is issued by the payment entity based on the following thresholds (2023 tax year)
Arkansas
> $2,500 and > 0 transactions
D.C.
> $600 and > 0 transactions
Illinois
> $1,000 and > 3 transactions
Maryland
> $600 and > 0 transactions
Massachusetts
> $600 and > 0 transactions
Montana
> $600 and > 0 transactions
New Jersey
> $1,000 and > 0 transactions
Vermont
> $600 and > 0 transactions
Virginia
> $600 and > 0 transactions
All other states follow the IRS threshold
> $20,000 and > 200 transactions
reallynicestamps
·2 years ago@jthole
But what is the sales threshold for my state, Minnesota?
Phone the office of your federal congressman.
You don't need the actual representative, if they are at all competent, the staff should have that information available for you, or be able to get it quickly.
That's what representative means.
I'm basing this advice on my years in the Office of Canadian cabinet ministers. When we got a query through a Member of Parliament, we jumped to answer it.
And a competent representative hires a representative staff.
But as lucky says:
But that is a threshold for whether eBay has to report payments made to you, not whether you have to report income. As far as I know, the IRS does not have any minimum threshold for reporting income.
dbfolks166mt
·2 years agoThere are multiple answers to your question. First anything above $0 should be reported on your income taxes. Secondly if you sell over $600 you will receive a 1099-K from eBay. Others have already explained what eBay factors into the 1099. Note if you are selling on other venues or forums and are being paid through a financial processor like PayPal or Venmo you will also receive 1099-K's from those financial processors once you eclipse the $600 threshold.
As to how that impacts how much you have to actually pay in additional taxes others have already pointed out that depends on multiple factors.
nobody*s_perfect
·2 years agoThe IRS has stated that it plans to set a threshold of $5000 for 2024, but that has not been finalized. The threshold for 2022 ($20K) was announced in December 2022, and the threshold for 2023 (still $20K) was announced in November 2023, so IMHO there's no point in speculating now. The threshold for 2024 could turn out to be $600, but we don't know yet.
dbfolks166mt
·2 years agoThe IRS has stated that it plans to set a threshold of $5000 for 2024, but that has not been finalized. The threshold for 2022 ($20K) was announced in December 2022, and the threshold for 2023 (still $20K) was announced in November 2023, so IMHO there's no point in speculating now. The threshold for 2024 could turn out to be $600, but we don't know yet.
OP is in Minnesota which has a state law reporting threshold of $600 so what the federal limit is currently at or what it will be in 2024 is irrelevant unless Minnesota changes it's current law. No speculation it's just the current status.
nobody*s_perfect
·2 years agoInteresting. Minnesota doesn't appear on the lists in any of my links to states with thresholds lower than the federal level. Do you have a link?
eddieslotcars
·1 year agoThis is bull **bleep** pay taxes on stuff that purchase and paid taxes on, then resell eBay and be tax & paid IRS tax again!
We need do some with the people in office to voted out!
Thank you
Ed
jthole
OP2 years agoI have sold more than $600 on ebay during 2023. But I have not receieved a form 1099-K from ebay. Do they usually mail it out? I do not see it in my seller's account.
reallynicestamps
·2 years agoYou pay taxes based on your total income after expenses*
Depending on your total income you pay taxes in several brackets.
If you are single and earn over $11K but less than $48K you are paying 12% income taxes.
But if you have a really good year on eBay and earn another $15K, you will pay 15% but only on that $15K!
And so on as you move from one bracket to the next.
The lowest bracket is 10%. The first $10K of your income is charged at 10%.
The highest is 37% but you only pay that on the part of your income that is over $609K.
I'm rounding here.
There are seven levels each charged a slightly higher percentage than the level before.
https://www.nerdwallet.com/article/taxes/federal-income-tax-brackets#2024-tax-brackets
And that's only on your income after deductions.
I once worked out that if I earn less than $17K annually ( about $8 an hour) I would not be paying any income tax at all because of my standard deductions.
*Expenses are things like eBay fees, packaging, insurance.
12345jamesstamps
·2 years agoTo put it in simple terms...after $600. made...you will get a 1099K form to add to pay taxes on that at end of year from whoever or wherever you made the money or got the money.
Ideally, any money made you should pay taxes on it...but the 1099K makes sure you pay for the amount because the IRS gets a copy of the 1099K...so they know.
But there are deductions you can use to even it out...so don't worry.
Save all receipts.
We wish everyone paid taxes from making money off of selling stuff....but I am not really sure how the IRS knows you made money without getting a 1099k form from someone. I wish someone here would enlighten me on that subject.
Filing taxes with some 1099k's will of course cost you more to file if you go to H and R Block or somebody like that. 1099k's and W2's do increase that cost of filing with someone like that(H&R Block). I asked when I filed taxes last week. LOL Best to have just one W2 and no 1099K. Kinda hard in these times of course.
gloryglorygifts
·2 years agoAt least the accountant fee is deductible next year.
monroe67
·2 years agoOP's title: "How much can I sell without adding it to my income taxes?"
So far, dnasilver has, in my opinion, posted the most accurate answer:
"Without knowing what other income you have no one [here] can give you a real answer."
It is unlikely that anybody on this forum knows who you, "jthole", really are, in real life, whether in Minnesota or Hawaii. I think you might look a little like Charlie Brown, but that's just a guess. We don't know you and we know even less about you.
Nobody here knows how many dependent children you can deduct on your federal tax return.
Nobody here knows how many of those dependent children are wearing expensive corrective dental braces.
Nobody here knows how much regular pay you get from your regular day-job or any other source of income.
Nobody here knows how much money you might have inherited from Great Aunt Gladys last year.
Nobody here knows how much passive income you receive from rents on the apartments you might own in New York City.
Conversely, nobody here knows if you are a retired person whose income, other than Social Security and/or pensions, is still low enough that the IRS does not require you to file annual income tax returns. (I have heard one of my neighbors talking about being in that situation.)
caldreamer
·2 years agoMinnesota is same as any other state...IRS requires that you report every dollar earned whether you get 1099 or not. You report "gross sales" to IRS and then deduct business expenses (EBAY fees, shipping expense (cost of printing labels), returned merchandise, cost of goods, mileage, packing supplies, office supplies, etc). If you have home office (dedicated to EBAY) or you store merchandise in your home you can also deduct % of your rent & utilities. You only pay income tax on "net amount" after all business expenses are deducted.
EBAY has "easy to read" 1-page report that shows YTD totals for (orders, returns, EBAY fees, shipping expense). To print report go to Payment, Reports, REPORTS (NEW) and select LAST YEAR. This report will be very helpful during tax time.
You will be responsible for keeping tracking of other expenses and also inventory sold. You will need to provide tax accountant with cost of goods amount for:
BEGINNING INVENTORY on hand - Jan. 1
ENDING INVENTORY on hand - Dec. 31
If you have never filed "business taxes" before I suggest you consult a tax accountant.
1786davycrockett
·2 years ago@jthole
You can also deduct the payments that you are no doubt paying for the use of the Charlie Brown character as your identifier on your eBay site.
You ARE paying for that image -- aren't you?!?
Or are you side-stepping that issue, as well?
dnasilver
·2 years agoWithout knowing what other income you have no one can give you a real answer. If you have zero income now, you could make up to your standard deduction before Federal income Tax kicks in. .
cashmeredelight
·2 years agototal is not based on sold prices but Ebay also adds in the shipping cost and taxes paid by the buyer. This makes the amount look great to the stockholders but sellers realize the amount is fake.
nobody*s_perfect
·2 years agoIf you get a 1099-K from eBay, it includes the buyers' total payments for the item and for shipping, but not the sales tax amount. This system is what the law requires; it's not something that eBay has chosen to manipulate.
dbfolks166mt
·2 years agototal is not based on sold prices but Ebay also adds in the shipping cost and taxes paid by the buyer. This makes the amount look great to the stockholders but sellers realize the amount is fake.
The taxes are NOT included as part of the sellers revenue nor is it reflected in the 1099-K.
theteamsetguy
·2 years ago@jthole ,
In most cases you take gross sales which includes any shipping fees you collected from the buyer, subtract ebay fees, shipping fees, mileage driven to the post office, costs of the items, and etc. You will need receipts to show the cost of your items.
ANY income whether is $5.00 or 5 million dollars after subtracting costs of your sales is taxable at both the state and federal label. Just because you don't get a 1099 doesn't mean you don't have to report your income. The IRS specifically mentions this.
rugerskick
·2 years agoIf your items are being sold at a loss, it won't affect your income at all. You will have made no profit.
gloryglorygifts
·2 years agoUnless ebay generates a 1099. Then it is best to file and show them all the losses and why it didn't increase your income.
umccars
·2 years ago...$599...
Unavailable member
·2 years ago@umccars
Even $599.00 amount of income should be declared on your taxes. Depending on what your business expenses are it may or may not be taxable, speak to a tax professional.
kensgiftshop
·2 years agoWhere did you come up with that number?
kensgiftshop
·2 years agoNone, you're supposed to report all your income.
monica-sells
·2 years agoto be technical....you can sell as much as you want
all that matters is what part of that is taxable
in other words, if you sell 1000.00 worth of stuff, but your costs/deductions are 1000.00 your taxable income is ZERO
chapeau-noir
·2 years agoDon't forget to use all of your legal deductions!
klhmdg
·2 years agoNothing .... all sales are considered income