1099K

[5kidsports01]

I am looking at my total sales for this year - what number does Ebay use to report to the IRS ?  do they use -- Total sales (Includes taxes)    or    Net sales (Net of taxes and selling costs) ???  i am over transactions -200 but not sure what number to use so i do not go over the 20,000 threshold....  thanks ... 

[12345jamesstamps]

Under or over $20,000 you report it doing your taxes. A 1099K does not go to the IRS as far as I recall if it is under $20,000. Next year probably will change.

Most important is doing deductions which usually averages out the net sales sometimes. Its important to do a spreadsheet of deductions and have every little receipt that deal with your selling...sales are important but the deductions are more important.

[monroe67]

"I am looking at my total sales for this year - what number does Ebay use to report to the IRS ?  do they use -- Total sales (Includes taxes)    or    Net sales (Net of taxes and selling costs) ???  i am over transactions -200 but not sure what number to use so i do not go over the 20,000 threshold....  thanks ... "

Of the two options you provide, "Total sales (includes taxes)" or "Net sales (Net of taxes and selling costs)" --

well, neither is correct.  

Essentially, the dollar amount will be the amount of your gross sales on eBay excluding only the sales taxes paid by your buyer(s).   That amount will be "net of [sales] taxes" but will include eBay's fees, which might be what you mean by "selling costs."  

You will probably be able to deduct eBay's fees on your tax return, as they are business expenses, quite like supplies such as envelopes, bubble wrap, blank labels, even your mileage for driving to and from the post office.  

Oh, yes.  You also have to have both (a) minimum $20,000 in gross sales (excluding only the sales taxes paid by your buyers) and (b) minimum 200 separate transactions in order for eBay to send you a 1099-K for 2023. 
If you have 225 transactions and gross sales of "only" $19,000, you will probably not receive the Form 1099-K from eBay.  

Of course, consulting a tax professional is advised.  

[nobody*s_perfect]

The amount on the 1099-K includes all of the buyers' payments for item price, shipping and handling. Everything except what the buyer paid for sales tax (if any).  The total on the 1099-K has NOT subtracted anything: Not fees, refunds, postage, etc.

If you sold a $50 item and charged $5 for shipping, then $55 will be added to your 1099-K.   Regardless of sales tax, fees, refunds, postage purchased, etc. Those are not factored-in.

https://www.ebay.com/help/selling/fees-credits-invoices/ebay-form-1099k?id=4794

[kraftique]

Ebay will send you a 1099K with all that info- or have it linked with your account in your hub if you meet the standards.  The IRS is giving  small sellers a learning curb again this year with filing.  They went back to the old rule for 2023.  

I do not think the IRS was ready for the influx of returns and congress is working on trying to fix the reporting requirements.

[mam98031]

https://community.ebay.com/t5/Announcements/eBay-and-TaxAct-partner-to-help-you-navigate-new-Form-10...

https://www.irs.gov/faqs/small-business-self-employed-other-business/income-expenses/income-expenses

https://www.irs.gov/businesses/gig-economy-tax-center

https://pages.ebay.com/seller-center/service-and-payments/2022-changes-to-ebay-and-your-1099-k.html

[worldcoinauctions]

Frankly I don't worry about what it says on the 1099. Whatever ebay says minus what I actually got is overhead. What gets sent to my bank is my net income from ebay. That gets added to my other internet income and income from other sources to be my net income. I do use the difference between what they say and what I got on my expense line.

[mr_lincoln]

Hi @5kidsports01 

To see APPROXIMATELY where you stand go to this page Seller Hub | Reports financial overview | eBay

and click the "Reports" link on the left side of the page.  The overview (below) will open and you use the little pull-down menu (green arrow) and create a Custom report from Jan 1 this year to present.  All the fields you see (other colored arrows) will have your gross total of sales, refunds, expenses (through eBay not your other expenses like packaging materials, mileage, etc). You can click the little icon to the right of the section titles and it explains what the dollar values pertain to.  

You can then download an IRS Schedule C and Instructions and read about all the deductions you can list to bring down the taxable income from your sales.  

[bentleys-auto-parts]

I called on this last week. 

Step 1: go to payments tab

Step 2: click reports

Step 3: click custom on period. 

Step 4: change to Jan. 1st. 

 Orders on the left shows total with out taxes charged, also shows expenses, and net to the right side.  

That's what will be on your 1099k

[srlnclt]

So do I enter the orders amount or orders minus expenses? Why do they make it so hard???  Thanks!

[luckythewinner]

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So do I enter the orders amount or orders minus expenses?

You are asking us what to "enter", but you are not telling us WHERE you want to "enter" it.

Why do they make it so hard

Without knowing what you are trying to do, we don't know who "they" are or what "it" is that is so hard.

Please come back and give us a complete explanation of what the "it" is that you are trying to do.

[srlnclt]

I'm trying to enter my  eBay sales on Turbo Tax online.  From the post above mine, I'm thinking I need to enter the yellow arrow "Orders" as my income in Turbo Tax.  However looking around on Turbo Tax isn't very clear where I enter it.  I didn't get a 1099K as my sales didn't meet the limits.  So do I enter it as Self Employment or Other Common Income?   Thank you.

[carbideliquidator]

IRS for the year 2023 is only requiring anything over $20,000 in internet sales must be reported to IRS and State in Form of 1099K......what Ebay does is up to Ebay......in year 2024 The IRS is requiring anything over $5,000 in internet sales be reported in 1099K.......but what IRS require and what Ebay is going to do could be 2 different things......Ebay may go ahead and file a 1099K on you regardless, that was the original plan from the IRS

[carbideliquidator]

Be careful what you report on your income tax return.........Ebay's gross sales ......does not include cost of goods deduction, gas, milage , packaging materials, store subscription, internet fees....there's a lot of deductions involved with selling online......the IRS will get 1099K's but that won't even come close to Net Profit.....you might sell $20,000 on Ebay, but your net profit might only by 20%......$4,000....this is where it's going to be a nightmare for them. 

[srlnclt]

Hmm that's not how I read it.  eBay isn't required to provide the 1099K however the seller is still required to claim any income.  It is still income even if less than $20k.