Locked
Discussion interactions are currently paused.
TAXES 2024 & 2025 $5K then only $600 for Calendar YEAR
The agency is also adding a transition year by setting a $5,000 threshold for transactions in 2024 and delaying the onset of the new $600 threshold until 2025, the IRS announced Tuesday afternoon.
what i is just goggled As I understand that is in CALENDAR YEAR someone talking about per month
5000 not so big. Ain't sure if i have done. My big question is PROFIT. What if on the GROSS SALES of 6000
that your profit after cost of item, FEEBAY cut, shipping that you made only??????????? Half that??
In my case I usually LOSE money. Just stuff I buy don't use, or try and do not like and resale. Losing 25% on a $100 tennis racket better losing $100 How heck IRS gonna distinguish this???????? Only stuff GIVEN to me , do I make much of a profit Heck someone gave me printheads and we split and I sold about $1000 gave him $500 sure cannot do this looks like anymore. Getting bit picky and looks to me impossible to separate sellers making money and other people just getting rid stuff
kh-stanley1
·2 years agoHi everyone,
Due to the age of this thread, it has been closed to further replies. Please feel free to start a new thread HERE if you wish to continue to discuss this topic.
Thank you for understanding.
2ndhand-mediaman
·2 years agoMost, if not all of the other commenters either dont file or never asked their accountants questions.
Make it easier: you MUST report all gross monies. If it be $1 or 18 billion. If you want to pay your tax burden is on you; at least pay your RITA.
Wherever the threshold is (still $20K, but may go back to $600, but may go to $5K. However was $20K for 2023) anything beyond that you file taxes for everything from $1 to your actual gross minus deductions.
Though the tax brackets are listed and known, what is not explicitly stated is the additional amounts owed for SSI and medicare.
Take away: at minimum file your taxes and claim all monies; and keep track of expenses.
mam98031
·2 years ago@2ndhand-mediaman
Most, if not all of the other commenters either dont file or never asked their accountants questions.
Well that is pretty presumptuous of you and no true I might add. You are assuming things you do not know.
Wherever the threshold is (still $20K, but may go back to $600, but may go to $5K.
It is and has been $600 for about 3 years now. IRS was able to get a temporary lift to the threshold the last couple of years 2022 & 2023 to the original threshold on 1099Ks of $20,000 and 200 transaction. At this time we do not know what the minimum threshold will be on this form. IRS did say they are going for $5,000, but that has not been confirmed and likely will not be until late this year.
However was $20K for 2023) anything beyond that you file taxes for everything from $1 to your actual gross minus deductions.
It just may be your wording here, but it doesn't even matter if you get a 1099K at all. All income is suppose to be reported to the IRS every year. 1099K is merely a form and nothing more than a form. It does not set a threshold for reporting income and never has.
Though the tax brackets are listed and known, what is not explicitly stated is the additional amounts owed for SSI and medicare.
What??
Take away: at minimum file your taxes and claim all monies; and keep track of expenses.
mam98031
·2 years ago@rosemary6525
You opened another thread on this same subject on 4/10. Was there a reason for that?
https://community.ebay.com/t5/Selling/IRS-Reporting-in-up-coming-years-Gonna-make-eBay-lose-big/m-p/34400861#M2382973
DON'T confuse the numbers on FORM, which is all a 1099K is, with what you need to report to IRS. With or without a 1099K you need to report your income to IRS.
A 1099K has NEVER set the amount of money you need to report to the IRS as income. No Form of any kind that IRS has sets the threshold for reporting income.
robbie31415
·2 years agoI feel like the majority of people freaking out about this are people who haven't been reporting. Naughty.
chapeau-noir
·2 years agoI actually had to file when I was 15 and working as a short-order cook at a truck stop. I was under-age but got a pass because I was working for a family business. But when I was 14 I did clothing alterations but didn't report anything as I was technically working for myself and no one bothered about the pittance I made doing that.
lacemaker3
·2 years ago@rosemary6525:
Reference for this? What's the link? Where did you see this?
I just googled trying to find the actual announcement, because, you know, I just like to read things and understand them for myself ... don't want to get fooled by fake news ... this kind of sounds like it ...
Google search -- nothing. Search of IRS.gov press releases and announcements -- nothing. Search for the first line (since it sounds like a quote, even though it's not in quotation marks) -- the only hit is for this thread.
Does anyone have a link to this announcement, because I can't find anything more recent than February, and that one DOES NOT support what the title of this thread says.
WAIT -- I FOUND IT! (it's not fake news, it's just almost 5 months old)
But it wasn't announced today (Tuesday), it was announced Tuesday Nov 21, 2023. It's about the original announcement back in November. The first line in the original post was from a news article back in November. No new information, nothing about a different threshold for 2025. It does not support what the title of this thread says.
https://rollcall.com/2023/11/21/irs-delays-new-online-sellers-tax-reporting-threshold/
nobody*s_perfect
·2 years agoThe only IRS announcement I've seen about $5000 is from last November, when they said, "the IRS is planning for a threshold of $5,000 for tax year 2024 as part of a phase-in to implement the $600 reporting threshold enacted under the American Rescue Plan (ARP)."
https://www.irs.gov/newsroom/irs-announces-delay-in-form-1099-k-reporting-threshold-for-third-party-platform-payments-in-2023-plans-for-a-threshold-of-5000-for-2024-to-phase-in-implementation
wastingtime101
·2 years agoFor the OP's benefit, or anybody else with similar questions: The IRS is planning on a $5k threshold for 2024. It could easily change. Nothing has been formally announced for 2025.
State thresholds trump IRS thresholds.
FS-2023-27, Nov. 2023
Following feedback from taxpayers, tax professionals, and payment processors and to reduce taxpayer confusion, the Internal Revenue Service delayed the new $600 Form 1099-K reporting threshold requirement for third party payment organizations for tax year 2023 and is planning a threshold of $5,000 for 2024 to phase in the new law.
Third party payment organizations include many popular payment apps and online marketplaces.
The agency is making 2023 another transition year to implement the new requirements under the American Rescue Plan that changed the Form 1099-K reporting threshold for payments taxpayers get selling goods or providing a service over $600. The previous reporting thresholds will remain in place for 2023.
[Sorry for repeating info; got distracted before I submitted the post I wrote.]
12345jamesstamps
·2 years agoWhat if a 10 year old kid made $601. selling lemonade at a stand? Does he need to declare it? Just curious.
wastingtime101
·2 years agoWhat does $601 have to do with it? Or $600?
https://www.irs.gov/newsroom/heres-who-needs-to-file-a-tax-return-in-2024
For tax year 2023, self-employed individuals must file an annual return and pay estimated tax quarterly if they had net earnings from self-employment of $400 or more.
A person claimed as a dependent may still have to file a return. It depends on their gross income.
Any single individual under the age of 65 has to file if their gross income is at least $13,850.
Read the above IRS link for more info.
Individual states may have different thresholds for state filings.
12345jamesstamps
·2 years agoReporting income.....if it be a 10 year old or a 60 year old I guess. Curious.
You always state all earned income should be reported by everyone.
wastingtime101
·2 years agoBy "you" do you mean me?
I don't always state that. See my first response on this discussion where I said:
you may be required to report your earnings even if you don't receive a 1099-K.
12345jamesstamps
·2 years ago"do you mean me"....as in the past you have mentioned that...yes.
Never talked about a person's age but that ALL should report earned income.
yuzuha
·2 years agoYep. I had to file tax returns when I was 17 because I made enough from my after-school job to require it.
12345jamesstamps
·2 years agoI also file for taxes at 16 because I had to give my social security to a place where I was washing pots and pans(horrible job by the way). And that is getting a paycheck.
But I am talking about a lemonade stand with a 10 year old. And expect the kid to record everything.
monroe67
·2 years ago"What if a 10 year old kid made $601. selling lemonade at a stand? Does he need to declare it? Just curious."
There is always a section in the 1040 Instructions that addresses the question of earnings by a minor child (or even an adult dependent, for that matter).
The chart on page 10 of the 1040 Instructions for 2023 explains when a minor child or other dependent is supposed to file his/her own return:
Parents or legal guardians of minor children can choose to include their dependent's $601 lemonade sales income on their own tax return forms. That tax scenario is discussed on page 8 of these instructions. Makes kinda more sense to include those $601 in the parent/guardian's return, because it was probably the parents/guardians who purchased the lemons and sugar, the ice, the paper cups, printed the advertising posters, etc., etc.
12345jamesstamps
·2 years agoWe are only talking about $601. bucks...so I guess it doesn't matter.
Can we expect kids to keep tracking on what they make day after day in the south?
dbfolks166mt
·2 years agoYou are assuming of course that this is going to make it through congress and get codified into law to overturn the current laws that are on the books. Also don't be surprised if more states do not pass their own threshold laws during the year and make the totals retroactive.
If after completing your taxes you are in the red with regards to your eBay sales that can offset other tax liabilities but there are distinct rules about how this can be applied and for how long. As @wastingtime101 suggested I would agree you should talk to a tax specialist.
fern*wood
·2 years agoWhy burden yourself with wondering what the 1099k threshold will be, because that doesn't matter as far as reporting sales goes.
luckythewinner
·2 years agoHow heck IRS gonna distinguish this
By having you fill out a tax return and tell them whether you made money or lost money.
caldreamer
·2 years agoDifferent states have different requirements when 1099 is sent you. Of course, IRS requires that you require "gross sales" for every dollar earned (even if you don't get a 1099).
EBAY has "easy to read" 1-page report that show YTD totals for (orders/gross sales, refunds, EBAY fees, shipping expense).
$20,000 GROSS SALES (as shown on 1099 or EBAY report)
-$500 EBAY fees
- $200 Shipping expense
-$1,000 your "cost of goods sold" plus other expenses (mileage, packing/office supplies, etc)
$18,300 NET SALES (taxable income)
wastingtime101
·2 years agoThose numbers @rosemary6525 are just the numbers at which eBay is required to issue a 1099-K. It has no bearing on a person's responsibility to report their earnings to the IRS. In other words, you may be required to report your earnings even if you don't receive a 1099-K.
By law, the 1099-K includes gross income. It's up to you to keep track of expenses and deductions to account for reporting your adjusted gross income.
With the limited knowledge in this area demonstrated by the questions you're asking, I strongly suggest meeting with a CPA to go over filing taxes for your eBay sales.
12345jamesstamps
·2 years agoWe talked about this before.
Save all receipts for this year for deductions....wifi monthly fee...monthly eBay fees, shipping postage, tape, boxes. if you use a telephone...eBay app...that's deduction...and so on. Deductions will work.
Congress is having a tough time doing anything...and until I see a change from $2000. to $5000. to $600. for California...I see no changes like last year which I did post here.