1099k

[Anonymous]

will the 1099K include sales tax

[pburn]

No.

Read eBay's help page for the explanation of the 1099-K. It will tell you everything you need to know about what eBay reports and what it doesn't.

eBay and Form 1099-K 

[monroe67]

Here's what eBay says about the 1099Ks they are required by the IRS to send to sellers.  The last line may be the answer to your question:

"What's included in Form 1099-K

As Form 1099-K is an IRS information return, it includes the gross amount of all reportable payment transactions within a calendar year, based on when funds settle to eBay, not necessarily when funds are received by sellers. This amount does not include any adjustments, for example, credits, discounts, fees, refunds, or any other adjustable amounts. This means that the gross amount on your Form 1099-K may not be the final reportable amount on your tax return. You should consult your tax advisor to determine how best to use the information on your Form 1099-K when filing your personal and/or business income tax return.

If there's an issue with any transaction on your Form 1099-K, you can contact us with the item number and any relevant information about the transaction.

Additionally, Form 1099-K does not include the sales tax when it is automatically collected and remitted by eBay."

[dbfolks166mt]

No. 

[onefootflipper2]

If you are trying to do $590 worth of sales or anything like that then don't trust that they won't send one out anyway. My wife's account got one last year on her $1100 worth of sales and last year's reporting requirement was $20,000, not $600. 

[nobody*s_perfect]

Your listings show that you are in Missouri, which is one of the several states that had already implemented a lower threshold for 1099-K's.  The threshold for Missouri residents was $1200.

[onefootflipper2]

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@nobody*s_perfect wrote:

Your listings show that you are in Missouri, which is one of the several states that had already implemented a lower threshold for 1099-K's.  The threshold for Missouri residents was $1200.

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Yes, but she had $1120 . Not $1200. They generated one anyway. That is why I said you can't trust that they won't just make one anyway.

[dbfolks166mt]

If you are trying to do $590 worth of sales or anything like that then don't trust that they won't send one out anyway. My wife's account got one last year on her $1100 worth of sales and last year's reporting requirement was $20,000, not $600. 

In 2021 and in some cases years before that individual states had 1099 reporting thresholds that were already below the federal level that takes effect in 2022. I am in VA and our reporting threshold has been at $600 since 2020 and I have received 1099's for a couple of years. 

[nobody*s_perfect]

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@onefootflipper2 wrote:

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@nobody*s_perfect wrote:

Your listings show that you are in Missouri, which is one of the several states that had already implemented a lower threshold for 1099-K's.  The threshold for Missouri residents was $1200.

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Yes, but she had $1120 . Not $1200. They generated one anyway. That is why I said you can't trust that they won't just make one anyway.

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Probably what she had charged for shipping put her over the threshold.

[mam98031]

No it will not.

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

[mam98031]

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@onefootflipper2 wrote:

If you are trying to do $590 worth of sales or anything like that then don't trust that they won't send one out anyway. My wife's account got one last year on her $1100 worth of sales and last year's reporting requirement was $20,000, not $600. 

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Even if you sell $599, you should be claiming your income on your Federal tax report.  

1099K is ONLY a form.  Nothing more than a FORM. It does not nor has it ever set the minimum requirement to report your income to the IRS.  

IRS has no minimum requirement for reporting income.  

As to your Wife's account.  You have to watch those STATE requirements as some have 1099K requirements too.

[mam98031]

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@onefootflipper2 wrote:

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@nobody*s_perfect wrote:

Your listings show that you are in Missouri, which is one of the several states that had already implemented a lower threshold for 1099-K's.  The threshold for Missouri residents was $1200.

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Yes, but she had $1120 . Not $1200. They generated one anyway. That is why I said you can't trust that they won't just make one anyway.

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Keep in mind that the 1099K represents the total amount of money received by MP for your account, BEFORE any deductions for fees, shipping, refunds, etc.

[inhawaii]

It amazes me that some sellers will actually try and limit their sales just to stay below the $600 threshold.

[onefootflipper2]

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@inhawaii wrote:

It amazes me that some sellers will actually try and limit their sales just to stay below the $600 threshold.

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Amazes me how may people will just keep repeating that in the case of my wife's 1099K that shipping or something put her over the top. I am listing the amount from the 1099K, not her sales total before shipping or taxes anything else like that.  We weren't trying to stay under the number for her or anything, it just ended up being close. 

As for staying under. I could see for the casual seller who would actually likely be able to report minimum or no profit on schedule C not wanting to deal with that at all. It costs a good extra $100 to do your taxes if you have that sort of paperwork involved.

Of course there are also huge numbers of sellers who never paid any taxes, can't report any earnings because they are actually cheating on various government assistance and other financial programs that they would stop getting if they actually reported their reselling income. Facebook marketplace is loaded with these sellers selling everything local pickup. There are at least a half dozen of them in my area just in the video games area, they always have hundreds of games in stock and won't do anything put local cash pickup.

Then there are others who just cannot, will not understand that they are only paying taxes on the profit.

[mam98031]

Your wife got her 1099K last year because of your state's requirement.  Not the Federal requirement.