K1 , keep under the $600 know your total , ?

[landy61]

K1 ,      trying to stop selling before reach the $600 mark. How do I find my total amount that counts up to the threshold $600

[shipscript]

Just receiving a 1099-K does not mean you will owe taxes on it. A 1099-K is a report of cash receipts, not necessarily indicative of profit. The amount from the 1099-K (or from your own sales records) would be added to your other income, and then you would deduct expenses, like cost of purchasing the items, refunds, postage purchased, packaging, and other costs.

Here are the parameters that eBay uses for a 1099-K:

• eBay looks at payments received from buyers on your behalf. This would include item + shipping (sales tax is not counted on a 1099-K, nor is international shipping and tariff that eBay collects) .
   
• If a buyer does not pay, the sale is not added to the 1099-K.
   
• If a buyer pays and you then refund, the payment is added to the 1099-K.
   
• At the end of a year, a sale in December that is paid in January is counted in January (in that next year).
   
• The payment date is based on when eBay settles the buyer payment and moves it from the buyer side of the ledger to the seller side of the ledger (when eBay says you may now ship), and is not based on the payout date when the seller receives the funds.
   

[kensgiftshop]

Why, you still have to report your income, no matter how much it is.

The $600 is when Ebay has to report it, it doesn't change when you have to report it.

[landy61]

So, the eBay fees  , are not in the total dollar amount toward the $600 limit  

Item sale amt, plus shipping  ?

ie.  Sold for         $50                                                Tax                      $3.60

        Shipping        10                                                  eBay Fees        $9.00

                                _____                                              ___________          .30

                                 $60   ( toward $600)                 Not counted toward the $ 600

[shipscript]

@landy61 

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@landy61 wrote:

So, the eBay fees  , are not in the total dollar amount toward the $600 limit  

Item sale amt, plus shipping  ?

ie.  Sold for         $50                                                Tax                      $3.60

        Shipping        10                                                  eBay Fees        $9.00

                                _____                                              ___________          .30

                                 $60   ( toward $600)                 Not counted toward the $ 600

---

That is correct.
Sales tax and export expenses that eBay handles never enter into your 1099-K accounting.

Nor do refunds or expenses reduce your 1099-K.

However, you can count your eBay fees, refunds, and the cost of purchasing shipping labels as business expenses against the income that eBay reports on the 1099-K (if you are filling out Schedule C on a tax return).

[landy61]

Thankyou to all.  Got it .     Problem was understanding   the $20,000 to $600  threshold.  So when no report of  sales up to 20,000  before,  and now, report up to $600     don't seem to mean much , if your income  , adds to your income either way.     ie like last year if sales were $19000 (eBay) this year  $600 , only difference would be  a K1 to deal with.    Hummm

What about Lawn sales ?

[evry1nositswindy]

Any and all money made on eBay is income and must be reported.  The only thing that changes is a piece of paper.

Take a look at a Schedule C and you will see how many deductions you can take.  Refunds come off the gross, as do fees, shipping, supplies, cost of goods, etc.  You report the net, not the gross.

[shipscript]

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@landy61 wrote:

What about Lawn sales ?

---

Lawn sales, yard sales, garage sales on your own property don't require third-party 1099-K reporting because there is no common platform involved to provide the paperwork. If clearing out your garage, you probably are not recovering the cost of purchase, so aren't generating a profit, and have not been required to report the income as a loss.  

https://www.hrblock.com/tax-center/income/other-income/capital-gains-garage-sale/

In contrast, items that sold at a profit, or goods that were purchased to sell on your lawn for profit, require reporting the profit on an income tax return, even though you will never receive a 1099-K for it.