Ebay falsely adding refunded transactions to the irs

[thanos219]

Please pay attention to your 1099-k forms and detailed forms. EBay does not report to the IRS any deductions that you have given or refunds that you have given out. I have been charged for three to four Xboxes and at least three of them I have refunded the money but eBay does not take that in consideration therefore they are charging me as if the transaction went through to put more money on my gross income. That is just in one month they have actually charged me almost $3,000 and refunded money when I only sold one Xbox. Sellers compare your detailed 1099 forms to your actual sales and see which ones you have refunded buyers when you find there is a discrepancy you will have to contact them for each case individually. I will have to go through over 300 items individually through their 1099 forms compared to the actual sales that was accumulated throughout the year last year and compared which ones I have refunded completely or a partial refund. EBay did not give the IRS the correct information and I don't think they expect sellers the thoroughly look through their report that their falsifying to give to the IRS. Be careful sellers. If anybody else has this issue please let me know. Thank you

[donsdetour · Accepted solution]

refund is a loss to you and is not removed from a 1099.

If you have to refund, that has to be done on a different form. Check all of this with an accountant.

The gross received minus the tax collected and remitted by ebay is on the 1099.

[monica-sells]

There is no discrepancy....

eBay did not "falsely" add transactions to your form...

(in fact, if it WAS NOT there, that would be false)

The 1099 Form is simple....EVERY transaction attributed to your account....IF it was refunded you deduct it..it is that simple...there is even a line for refunds, adjustments etc....on your Schedule C,.....

This isn't that difficult people

[fern*wood]

That's how they work.  I keep track of any refunds I make throughout the year to use as one of my deductions when I file my taxes. 

[lepke1979]

While it'd be nice if they accounted for that stuff. It isn't incorrect for them to just give the gross sales. You'll need to enter returns/refunds or discounts on your tax return to reflect the difference.

[luckythewinner]

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@thanos219 wrote:

Please pay attention to your 1099-k forms and detailed forms. EBay does not report to the IRS any deductions that you have given or refunds that you have given out. 

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There is nothing "false" about it. 

The law regarding issuing 1099-Ks prohibits eBay from making adjustments like that. 

It is your job to account for returns and refunds on your tax return.

Schedule C even has a specific line for them. 

[lacemaker3]

@thanos219, I'm sorry, but you are misunderstanding this. 

The IRS requires that your gross receipts be reported on the 1099-K. The payment processor is not allowed to deduct anything from the gross receipts. It is up to the payee (the seller) to account for their expenses, which includes eBay fees and refunds, in addition to your cost of goods sold, which eBay has not record of.

[thanos219]

As you could see I don't know anything about taxes. So your suggestion would be to go onto the eBay site in the selling section and over the past year look for any refunds that I have given, print out copies of those down and give that to my tax prepper with the 1099 that eBay sent?

[lu12-deals]

I'm pretty sure that refunds show up on the report you can get from the Payments tab. I usually run that every month, so I can see a net amount for each transaction , and then calculate net income. 

[monica-sells]

yes....as well as all the selling'fees' (FVF, PL, transaction fee) and shipping costs for delivering items....

all the costs associated with selling are acceptable to 'reduce' the GROSS amount to come up with the 'taxable' income......

you would be surprised how quickly that amount is reduced when you start deducting allowable amounts......

[katzrul15]

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@thanos219 wrote:

As you could see I don't know anything about taxes. So your suggestion would be to go onto the eBay site in the selling section and over the past year look for any refunds that I have given, print out copies of those down and give that to my tax prepper with the 1099 that eBay sent?

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Yes.  You need how much also you spent on shipping, supplies, toner, mileage fees, etc etc.  Your tax preparer can give you a list.

[deltilogical]

You're telling me when I send back a $1 for overpaid postage, that at is not included in the 1099K and I have to manually go through 1000's of transactions to sift these out?

[ryanrobyn]

we are all faced with this concern. just keep good records and use them as deductions 

[luckythewinner]

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@thanos219 wrote:

As you could see I don't know anything about taxes. So your suggestion would be to go onto the eBay site in the selling section and over the past year look for any refunds that I have given, print out copies of those down and give that to my tax prepper with the 1099 that eBay sent?

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Go to the Payment section of the Seller Hub and click Reports. Select Transaction report, select All statuses, select All transactions  and put in the date range for the entire year. Then click Generate report. 

When the report is ready, it will be a CSV file containing all your transactions for the year. 

Open the CSV file with a spreadsheet program (if you don't have one, OpenOffice is free) and sort the transactions by Type. 

• All the transactions with Type = "Refund" are all of your refunds. 
• All the transactions with Type = "Order" are all of your orders. 
• All the transactions with Type = "Shipping label" are the shipping labels you bought. 
• All the transactions with Type = "Other fee" are your fees that were not deducted from orders. 
• All the transactions with Type = "Claim" are your claims.  
• All the transactions with Type = "Hold" are your holds (neg values are holds, pos values are holds released).  
  etc. 

[kensgiftshop]

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@deltilogical wrote:

You're telling me when I send back a $1 for overpaid postage, that at is not included in the 1099K and I have to manually go through 1000's of transactions to sift these out?

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Yes, if you want to deduct them.