Does Ebay or Paypal report our sales to IRS?

[janies_bizz]

I just started selling on Ebay and Im a little worried about reporting my extra little income. Its not that much but is there like a certain amount that I have to make for them to report or how does this work? Any help would be appreciated. Tax time is near.

[kansas_gal06]

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@ravewings wrote:

Minimum wage(artificial wage), peace time military(policing the world), social security(ponzie scheme), healthcare(redistribution) are usually the reasons people don't pay taxes.

If excise taxes aren't enough, it's because the budget isn't efficent; more taxes are just more money thrown away.

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Exactly my point. You want someone else to pay, because the govt doesn't spend it correctly.

I'm not stupid. I know they spend other people's money foolishly.  I also know a lot of that money goes to relatives/family members.

But when it's all said and done-

Enjoy that long drive on an non-bumpy interstate highway without getting sick at whatever diner you might stop at to eat.

Which you can't experience in a lot of countries. I love USA.

Hope everyone has a great summer!

[nextoonew]

Its 200 in sales AND 20K not OR  BIG difference....

[expertbenefits]

You mean you paid sales tax on new stuff that you buy but you don't want to pay tax on the profit later? If you are a reseller you can avoid sales tax in your state by obtaining a resellers license with your vendors. Some eBay sellers do not accept them since they have not set up a business per se and they only waive sales tax for resellers with a resellers license.  Income tax on profit only, sales tax depends upon where you live and if the seller has a presence in more than their own home state (warehouse or address or retail store). Everybody that makes money ends up paying sales tax anyway except in those states that don't have sales tax and choose income tax instead usually higher taxes based on earnings.  Most everyone pay income tax to fund highways, schools and military though our roads and bridges and infrastructure are crumbling since no one will vote to rebuild anything. No one likes to pay taxes but death and taxes are the only sure thing.

[scrobin06]

if you're selling PERSONAL items then there is no profit or loss taken....for example, If i sell my car for $10,000 and I paid $20,000 for it new and it was just my personal vehicle then no loss or gain reported...same if you sell your sweater, shoes, etc...you used your money to buy it (which you earned from your job to which you already paid tax on) so selling it just recoups that money...no big deal...so cleaning out garage, yardsale items, etc are n/a which is why they use the 200 items and $20,000 rule for reporting.

If however you're in teh business of selling items you bought then you need to report it and should report anything you run as a business...For example, I start a business with $1000...i spend that $1000 at local garage sales buying items i know i can sell for more online...I sell those items i collected for $2000...you now have a $1,000 gain that you need to report and pay tax on.

[henryviiofengland]

I'm a little confused about this 200 sales AND $20,000 thing. So are you saying that if I don't meet BOTH of those criteria then the income doesn't get reported? In other words, if I sell more than $20,000 in that year but it amounts to less than 200 total sales for that same year then it DOESN'T get reported? Is that correct?

[hidy-hoo]

@henryviiofengland From PayPal:

PayPal is required to report gross payments received for sellers who receive over $20,000 in gross payment volume AND over 200 separate payments in a calendar year.In order to help you understand these changes, we have prepared the following FAQs.

FAQs:

https://www.paypal.com/webapps/mpp/irs6050w

[mabelsgreatstuff4you]

I called paypal yesterday because my ebay sales totaled 15,000 but paypal had me at just over 20,000...I freaked and called. The irs department at paypal told me it was because I had received the extra money in friends and family payments from relatives. I said how can they tax money that my family already paid taxes on? He told me they include that. I am reading here in another thread that amount is filtered out when paypal considers whether to send a 1099k...does anyone know for a fact which is correct??? Thanks.

[hidy-hoo]

Hi Mabel, According to the PayPal FQS page, Friends and Family money received should not be counted for 1099 purposes:

Are personal payments that I receive counted in the total that will be reported to the IRS?

No. Personal payments that are not payments for the sale of goods or services will not be counted when determining if the IRS thresholds have been reached and will not be included on your Form 1099-K if you exceed the thresholds. However, all payments received for the sale of goods or services will be used to calculate the gross payment volume to be reported. PayPal monitors accounts to ensure that personal payments are not being used for sales of goods and services.

https://www.paypal.com/webapps/mpp/irs6050w

Perhaps this FQS page has been revised by PayPal, but I have not seen any revisions.  I would call PayPal back and have them look at the link I provided and ask to see the new policy that includes Friends & Family payments totals in your 1099 in writing.  If the PayPal Customer Support reps are anything like the eBay CS reps, they don't always dole out the correct information 

[sexygirlrocks]

Whew! Thanks I was sweating there...yeah under my total sales amount they have the entire amount listed but when I called they broke it into two groups...I will have to call them again, thanks for the reply.

[tcrowley78]

So, if you make less than 200 sales and less than 20,000....you don't have to report it out claim it on taxes?

[rastamon42]

No, it means that Paypal doesn't issue a 1099. You still pay taxes on your profits.

This is not a difficult concept.

[stellareikipicks]

i make well over $20k but i don't reach 200 transactions therefore i haven't received any 1099 from paypal for past three years.. and i wouldnt want to self-report this income pay tax for this because it might jeopardize my current visa status. so in this case what's the possibility that irs ever finds out about my income. will they come and check my paypal at some point or what? how do they ever know that i made that much and never reported?

[exclusive_electronics]

Hey guys,

Did the paypal tax forms go out already and if not, when do they send them?

[orangeorchid29]

I have been selling my personal Items. Most at a loss to pay for my sons Medical Expenses. These were items I sold most on pennies on the dollar. Clothes shoes Etc. they told me to print a 1099 k. Why should I have to pay taxes on my property. I paid sales taxes. eBay Fees, PayPal fees. It is personal items. I do not have a Tax number. I refuse to pay taxes on personal items.

[orangeorchid29]

I only sell my personal Items at a loss. All at a loss. Like a $ 100 pair of shoes for $10. Garage sale things and collectibles. What about EBay fees. PayPal fees, postage. This is the first I have heard. Most of my things are older than 5 years. I was mainly selling for my sons Medical expenses. Which have been eaten all of my money up. eBay never told us and either did PayPal. Ridiculous.