1099-K

[rdd2658]

Looks like the small seller on ebay is now going to have that last nail in the coffin to stop selling on ebay.  It used to be a great place to make some extra money, but I have been finally priced out.  Overhead like, cost of item, fees, and the ultra high USPS postage changes over the last few years (price by area of the country, and the biggest scam of Christmas surcharge that starts OCT 1st of each year now, retired mailman here, NEVER have I delivered xmas mail in Oct or Nov!), makes a profit margin of only 10% not worth it,,,,even more so only to be taxed over 600.00 grass sales.  zero money to be had anymore.  Yes, just increase your price, most would say,,,,well after 22 years on ebay I know what prices people are willing to pay,,,,,an increased price is not part of the fix....

[bubbempny]

The $600.00 is gross which includes postage and fees.  Once that is paid I only net a few dollars.  It will be hardly worth my time.

[mam98031]

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@bubbempny wrote:

The $600.00 is gross which includes postage and fees.  Once that is paid I only net a few dollars.  It will be hardly worth my time.

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It does NOT include fees.  Your gross sales are the Product price plus whatever you charge for shipping.  Everything else is a cost that you can take away from that amount to arrive at a Net sales amount that would be subject to your Income tax if you are not selling stuff from your closet just to make a few bucks.

@bubbempny 

[inexpensivetrifles]

1. That is an IRS rule not an eBay rule.

2. You are not taxed on gross sales, you are taxed on gross PROFITS.

3. You should have been paying taxes on gross profits even without the 1099 per IRS rules.

4. Zero sympathy.

[wildpitchsports]

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@inexpensivetrifles wrote:

3. You should have been paying taxes on gross profits even without the 1099 per IRS rules.

4. Zero sympathy.

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Nobody asked.

[Anonymous]

For those who are saying "It is income, you owe taxes on it, just like any other income." - This is true when buying product for resale, AND making a profit. However, when I sell something out of my closet, which I purchased with money that I already paid income tax on, AND I am selling the item at a LOSS, I should not be paying income taxes on it.  Been on eBay for over 20 years, used to sell on here instead of having yard sales or using Craigslist, now I am down to 7 items for sale, maybe 3 more to list, then no more selling. Will probably keep my account just to buy stamps and coins now and then. I DO understand that the problem is with the IRS not eBay, but that is not relief for the problem.  I have never made much money on eBay, only got back a portion of what I had spent on items I no longer wanted, so in my case I don't even have to replace the faux income I got from eBay. Just need to be more careful in my spending habits and know for sure that I want to keep an item long term before I make a purchase.

[6500410]

Question to anyone experienced with the 1099-K: Let's say I had $23K in sales (reported in box 1a) for 2021 and $1500 in refunds. Is the $23K in reported sales AFTER the $1500 in refunds or is the $23K BEFORE refunds were processed, and I now need to deduct those from the $23K. There is no information on the 1099-K that clarifies this. Thank you.

[nobody*s_perfect]

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@6500410 wrote:

Question to anyone experienced with the 1099-K: Let's say I had $23K in sales (reported in box 1a) for 2021 and $1500 in refunds. Is the $23K in reported sales AFTER the $1500 in refunds or is the $23K BEFORE refunds were processed, and I now need to deduct those from the $23K. There is no information on the 1099-K that clarifies this. Thank you.

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The 1099-K does not deduct for refunds, fees, postage, etc.

If you received $23K and then refunded $1500 to your buyer(s), the 1099-K would report $23K.  The $1500 is a deductible expense.

[beatlesmania]

No, EBAY threshold has been sellers making over $20,000 a year pay taxes.

[wildpitchsports]

It's been across all online selling platforms, 200 items sold and over 20K in sales to get the 1099-k.

Starting 1/1/22, it's $600 for U.S. sellers no matter how many transactions you have you'll be turned in to the IRS.

[stackers_xag]

Bye. You haven't been paying taxes for years anyway, now you have to. Boo Whoo

[wildpitchsports]

You can say "bye" to the sellers all you want....

The increased fees will be saying "hello" to you to compensate.

Enjoy your fees & taxes!

[lostinmodels]

Correct. If you're selling personal goods (eg. not selling for profit or as a business) then the IRS allows you to claim the gross sales (gain) of the 1099-K as a loss under miscellaneous income so the income and loss cancel out your tax liability. As far as I can tell there is no limit. Talk to a tax expert or search 1099-K under your tax software. Turbotax had a section that explained how to do this.

[msmsales]

This is my issue.  Like 99% of what I sell is just stuff to fund my hobby.  I break even if I am lucky.  Now I have another tax form to deal with and expenses to keep up with.  A bigger issue is who knows where some of the receipts are for things I purchased years ago.  The paperwork and risk of an audit is not worth it just to mess around.  I fully plan on cutting back my buying and therefore my selling.  I am also going to start saving a lot more receipts I guess.  I just think the result is not the intent here and the threshold is too low.  I am 100% on board with paying my taxes, but I am not a business and that is not why I sell on e-bay.  I do it to try new things.

Also, does anybody know what schedule your COS would go on for a personal return?

[scwood52]

Yes sir...........I choked when I got a $2400.00 1099 for selling some personal paid, personal kept, high end collectible tools on Ebay, tools that I decided it was time to let go.

After all their 9%? fees and also fees for shipping costs (not through Ebay), then I get slammed by the IRS for another 2 hundred and eighty some dollars.

And, since I'm retired and on SS, I haven't had to file the last 3 years previous, I had to file because of the 1099. H&R Block was kind enough to charge me $129.00 because I was now a business selling tools.

Never again will I sell on Ebay, helping the CEO and crew make multi millions every year.

I've never been a big seller, mostly buying. But enough is enough.

[baysales77]

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