eBay

midnight_run · ‎01-02-2020

Hi,

I've seen this answered before several times several years ago, but I don't see anything VERY current and explaining any change to this as a result of Ebay structured payments and further separation from paypal regarding payment processing.

Automatic report of 1099K: thresholds = >200 transactions AND >$20K in gross sales. Although any profit must be reported.

1) Is there any change to the thresholds of 200 + $20K for 2019 behind us or new levels for 2020?

2) For 2019 (and 2020), will this 1099K be issued by paypal or Ebay (or both redundantly)?

3a) Ebay is moving sellers to "structured payments" I believe making Ebay the payment processor (similar to another "E"tsy marketplace who does report a seller 1099K as a they are a payment processor). If you're in the eBay structured payments program, will that 1099K now come from Ebay alone and not paypal?

3b) and, if you use paypal for additional transactions outside EBAY, I assume Paypal will still report their separate 1099K if you exceed the thresholds from paypal independently of Ebay?

I'm trying to understand when I go to structured payments in the future where all my 1099K may come from to be sure I don't miss one.

So basically, if I exceed the 200 & $20K thresholds for each Ebay (as the payment processor in the structured payment program), paypal outside of ebay, and another online marketplace, I should expect to report on 3 1099K, correct?

thanks !

corvettestainless · ‎01-02-2020

Yes, you will report all 3 together in 1 line, as well as anything else you should report. Paypal will do paypal, once in Managed Payments with ebay, you will get it from ebay (200/20000 is a law- so that's what they will follow). I've seen nothing on any changes for 2020- but who cares as all is reportable (can run monthly or annual report on paypal to get a total, even if its $3000).

luckythewinner · ‎01-02-2020

if you use paypal for additional transactions outside EBAY, I assume Paypal will still report their separate 1099K if you exceed the thresholds from paypal independently of Ebay?

The PayPal 1099K is issued based on the activity for a taxpayer, not for a specific account or a venue. PayPal will issue one 1099K for your SSN or TIN and will total up all transactions for all PayPal accounts associated with that ID. The 1099K has nothing to do with the eBay account or the or the PayPal account - it has to do with the taxpayer.

Is there any change to the thresholds of 200 + $20K for 2019 behind us or new levels for 2020?

If you meet the thresholds, PayPal is required to file a 1099K.

But I do not believe there is anything in the law that prevents PayPal from issuing a 1099K for taxpayers below the threshold, if they choose to.

https://www.irs.gov/businesses/understanding-your-form-1099-k

Also, there are a few states who have mandated the 1099K be issued for lower thresholds. I believe Massachusetts requires a 1099K for anyone over $600.

https://www.mass.gov/info-details/massachusetts-reporting-requirements-for-third-party-settlement-or...

nobody*s_perfect · ‎01-02-2020

@midnight_run wrote: ... if I exceed the 200 & $20K thresholds for each Ebay (as the payment processor in the structured payment program), paypal outside of ebay, and another online marketplace, I should expect to report on 3 1099K, correct? ...

Yes, each payment processor will issue a 1099-K if you go over both thresholds in your account with them. It's comparable to getting three W-2's if you worked for 3 different employers during the year.

As noted, the threshold is lower in some states: Massachusetts and Vermont require a 1099-K for any account that transacts over $600 (regardless of number of transactions). These override the federal thresholds which remain unchanged.

tml989 · ‎01-02-2020

@luckythewinner wrote:
if you use paypal for additional transactions outside EBAY, I assume Paypal will still report their separate 1099K if you exceed the thresholds from paypal independently of Ebay?

The PayPal 1099K is issued based on the activity for a taxpayer, not for a specific account or a venue. PayPal will issue one 1099K for your SSN or TIN and will total up all transactions for all PayPal accounts associated with that ID. The 1099K has nothing to do with the eBay account or the or the PayPal account - it has to do with the taxpayer.

Is there any change to the thresholds of 200 + $20K for 2019 behind us or new levels for 2020?

If you meet the thresholds, PayPal is required to file a 1099K.

But I do not believe there is anything in the law that prevents PayPal from issuing a 1099K for taxpayers below the threshold, if they choose to.
https://www.irs.gov/businesses/understanding-your-form-1099-k

Also, there are a few states who have mandated the 1099K be issued for lower thresholds. I believe Massachusetts requires a 1099K for anyone over $600.
https://www.mass.gov/info-details/massachusetts-reporting-requirements-for-third-party-settlement-or...

I have noticed you, on more than one thread, mention Paypal only issuing one 1099K for a SSN. I have two Paypal accounts, both in my name and SSN, and I receive a separate 1099K from Paypal for each account.

nobody*s_perfect · ‎01-02-2020

@tml989 wrote: .... I have two Paypal accounts, both in my name and SSN, and I receive a separate 1099K from Paypal for each account.

That's surprising! Did each account go over the thresholds, or did they only meet it when combined?

tml989 · ‎01-02-2020

One had appx 65K and the micro account had appx $17K, so no, only one went over the threshold.

luckythewinner · ‎01-02-2020

@tml989 wrote:
I have noticed you, on more than one thread, mention Paypal only issuing one 1099K for a SSN. I have two Paypal accounts, both in my name and SSN, and I receive a separate 1099K from Paypal for each account.

PayPal always said the thresholds were applied by TIN and reported that way to the IRS. But after reading this page again, I stand correct!

https://www.paypal.com/us/webapps/mpp/irs6050w

"PayPal and all other payment processors are required to determine if the IRS thresholds have been met and, if so, to report payment volume to the IRS by tax ID number such as a Social Security Number (SSN), or Employer Identification Number (EIN).

For example, if two accounts have the same tax ID number on file and have the payment levels shown below, PayPal will report both accounts on separate 1099-K Forms.

Example:

Account A - $18,000 in payments received for goods or services and 180 transactions
Account B - $3,000 in payments received for goods or services and 30 transactions

midnight_run · ‎01-03-2020

so, makes sense. because 1 account went over they gather your collective accounts by SSN TIN etc, regardless of amounts in those smaller accounts and report it collectively. Sort, or all or nothing with the trigger being the thresholds.