mam98031 • Volunteer Community Member • Buyer/Seller since 1999
Simply-the-best-for-you Volunteer Community Mentor
There was a wonderful Podcast earlier today on the subject of 1099Ks. I would encourage sellers to take the time to go and listen to it or read the transcript, whichever is best for you. It is worth the time. Even if you think that you have a handle on the subject, it might just clarify something for you.
There was just a few things I'd like to clarify that come up in the Podcast.
There was discussion of what a SSN, TIN and EIN are. EIN is for Corporations and/or LLC. SSN & TIN is for individuals and sole proprietorships. A TIN is NOT exactly like an SSN. It is another number you can apply for from the IRS in order for you to help protect giving out your SSN. You can apply for the use of a TIN.
Throughout the Podcast Manish refers to Sales as to what the dollar figure reported on the 1099Ks and it is NOT sales. As many of us know, if we have a sale, sometimes the buyer simply doesn't ever pay. These non paid sales do NOT ever appear on a 1099K. 1099K's are reporting TOTAL MONEY received.
The $$ represented on a 1099K by Ebay or any other money processor is for how much MONEY was received into your account BEFORE any type of deduction to include refunds. 1099K represent your GROSS RECEIPTS before refunds of any kind for any reasons.
So in the Podcast, keep that in mind. Your 1099K is NOT reporting your Sales nor is it totally about your sales. It is all about the MONEY you received and was processed by the Money Processor, in this case Ebay.
This statement was made in the Podcast, while not wrong, I just thought a little more clarity was needed. "So you won't owe any taxes on something you sell for less than what you paid for it." This is specifically regarding those that sell only there personal stuff. I know for some that may have been crystal clear but others it may not have been and this is such an important point for MANY Casual Sellers.
"I'll add one final note on this subject of $600 threshold. It is calculated based on the date on which your item sold and not the date on which you received money in your account which may sometimes be different." First I don't think anyone is getting their money the same day a buyer pays, not in MP anyway. Second, the amount that appears as your Net Receipts on your Ebay 1099K is NOT based on your sale date / transaction date. That is incorrect. It is based on the Payout / Settlement date. The date MP releases your Payout to you. That is the date Ebay uses to calculate the Gross Receipts for each seller.
So this means if you are a seller that gets a Weekly Payout. In 2021 your last Payout was 12/28/21. So the remaining sales you had in 2021 will appear on your 2022 1099K.
In the Podcast they refer to the Ebay FAQs on the 1099K, here is the link.
https://pages.ebay.com/seller-center/service-and-payments/2022-changes-to-ebay-and-your-1099-k.html
@mam98031 wrote:
@simply-the-best-for-you wrote:
@mam98031 wrote:
@simply-the-best-for-you wrote:
@mam98031 wrote:
With that said, I'm working with those from the Podcast to create a list of links that may help some Ebayers when preparing their taxes. I'll post about it when it is complete. I do not know when that will be, but hopefully before the month ends.
That's great of you to do, please let them know that Sole Props DO get EIN's. They are mistaken.
Did you read my opening post on this thread? I even give a link so that those that want to can easily find it.
Yes, I did, I'm not sure what you're referring to. In post 12 I let you know that they were wrong about EIN's. You Thumbs Up'd that post.
Subsequently, many, many pages later you mentioned that you are working w/those who put together the podcast. I was just commenting/asking you to let them know that they are wrong about EINs, as I'd posted in post 12 & you 'liked'. That's all.
Are we miscommunicating?
I think we are. Sole Proprietors can use the SSN or get a EIN. Both are fine.
Yes, I know. LOL, I think we're miscommunicating too & it's not that big of a deal. You mentioned that you were working with the Ebay Podcast folks. I was just asking you to let the Ebay podcast folks know that thie statement bolded below is incorrect, that's all. I posted that it's incorrect in post 12 & you 'liked' my post, so I thought you were in agreement that it's incorrect. I just thought if you were working with those folks, you could let them know, so they don't continue to spread misinformation. An EIN is NOT just for corps/LLC's, I have an EIN & am a Sole Prop.
That's all, it's no biggie, just if you happen to think of it, while you're working with them.
"There was discussion of what a SSN, TIN and EIN are. EIN is for Corporations and/or LLC. SSN & TIN is for individuals and sole proprietorships. A TIN is NOT exactly like an SSN. It is another number you can apply for from the IRS in order for you to help protect giving out your SSN. You can apply for the use of a TIN."
Griff finally confirmed on the PodCast discussion for this subject that the Payout date / settlement date is the date used for calculating what appears on your 1099K.
Just keep in mind it is NOT the total of your Payouts, it is the SALES represented in the payout that is on your 1099K BEFORE any deductions of anything, no matter the reason.
