klhmdg • Volunteer Community Mentor
nothing "new" about it.
Sellers are to report all income no matter what the $ amount.
The only change was the 1099 is now sent to the seller and IRS for any amount over $599
You should talk to a tax professional.
Asking about taxes online you will get many opinions and none of them know your situation.
IRS has not changed their rules on when you are suppose to claim your income on your federal tax report. We have always had to or been required to report our income, all of it. With or without a form like a 1099K, you have always been responsible to report your income.
You have a MAJOR misunderstand like so many others. The threshold on an IRS FORM, ANY FORM, does not set the minimum for reporting income to IRS. The 1099K is merely a FORM and nothing more.
When the minimum threshold on the FORM was 20K, that met that only those that made above that got the FORM. What it DID NOT mean was that anyone below that 20K did not have to report their income to the IRS. And that is likely what will get some people in trouble because they assumed something that was not ever based in FACT. IRS does NOT HAVE a minimum requirement on reporting your income. So even when the FORM threshold was 20K, those that made 15K, 10K, 5K, 1K, etc. were still responsible for reporting their income.
Everyone needs to remember that the 1099K is ONLY A FORM and nothing more. It does NOT set the minimum requirements to report income to the IRS. That would be like saying if you don't receive a 1099K for ANY type of income you receive, you don't have to report your income and that is ridiculous. The 1099K only covers internet related payments. It doesn't cover when people are paid by check or any other form. So to think that the 1099K has the power to set the minimum standard for all of IRS, all those people that are NOT paid via the internet would not have to claim their income, which we all should know is not true.
You do not need to have a business license. You can operate what is called a Sole Proprietorship, which is what I've done for the past 20+ years.
If you are going to sell on a regular basis, you can file for a business license with your state. Then also get the Resale certificate so you can purchase your inventory without paying sales taxes. Most states have small business credits, so it may not even cost you anything or a very small amount.
@gregs_collection wrote:I would check the requirements of your state. In California, they have a requirement for a resale license after a number of sales made. Each state has regulations to the types of merchandise and the amount of income. If in doubt, talk to a Accountant and or business lawyer. Some will allow a free 1st time consultation. Uncle Sam will sooner or later want there share. It's not wise to try to skirt it. I myself have a state sales permit and business license which give me some perks to others who don't. The last thing you need is a visit from a IRS agent.
This is great advice.
STATE | 1099-K FILING REQUIRED | DOES STRIPE FILE | FILING DUE DATE* | FILING THRESHOLD | IF ISSUED, PROVIDE STATE NUMBER |
Alabama | State Portal | April 30 | Same as IRS | – | |
Alaska | No | – | – | - | – |
Arizona | If State Witholding | Same as IRS | US$ 0 | – | |
Arkansas | CFSF | Same as IRS | US$ 2.499,99 | – | |
California | CFSF | Same as IRS | Same as IRS | – | |
Colorado | If State Witholding | Same as IRS | US$ 0 | – | |
Connecticut | State Portal | April 30 | Same as IRS | Connecticut Tax Registration Number | |
Delaware | No | – | – | - | – |
District of Columbia | State Portal | Same as IRS | US$ 599,99 | – | |
Florida | State Portal | April 30 | Same as IRS | – | |
Georgia | If State Witholding | February 28 | US$ 0 | – | |
Hawaii | CFSF | Same as IRS | Same as IRS | – | |
Idaho | If State Witholding | February 28 | US$ 0 | Idaho Withholding Account Number | |
Illinois | State Portal | Same as IRS | US$ 1.000 and 4 transactions | – | |
Indiana | If State Witholding | Same as IRS | US$ 0 | – | |
Iowa | If State Witholding | February 15 | US$ 0 | – | |
Kansas | If State Witholding | Same as IRS | US$ 0 | Kansas Withholding Tax Account Number | |
Kentucky | If State Witholding | Same as IRS | US$ 0 | – | |
Louisiana | If State Witholding | Same as IRS | US$ 0 | – | |
Maine | No | – | – | - | – |
Maryland | CFSF | Same as IRS | US$ 599,99 | Maryland Central Registration Number | |
Massachusetts | State Portal | Same as IRS | US$ 599,99 | – | |
Michigan | CFSF | Same as IRS | Same as IRS | – | |
Minnesota | If State Witholding | Same as IRS | US$ 0 | – | |
Mississippi | State Portal | February 28 | US$ 600 | – | |
Missouri | No | – | – | - | – |
Montana | State Portal | Same as IRS | Same as IRS | – | |
Nebraska | No | – | – | - | – |
Nevada | No | – | – | - | – |
New Hampshire | No | – | – | - | – |
New Jersey | CFSF | Same as IRS | US$ 999,99 | – | |
New Mexico | CFSF | Same as IRS | Same as IRS | – | |
New York | State Portal | April 30 | Same as IRS | – | |
North Carolina | State Portal | Same as IRS | Same as IRS | NC Withholding ID Number or EIN | |
North Dakota | No | – | – | - | – |
Ohio | No | – | – | - | – |
Oklahoma | No | – | – | - | – |
Oregon | State Portal | Same as IRS | Same as IRS | – | |
Pennsylvania | No | – | – | - | – |
Rhode Island | If State Witholding | Same as IRS | US$ 100 | – | |
South Carolina | If State Witholding | Same as IRS | US$ 0 | SC Withholding File Number or EIN | |
South Dakota | No | – | – | - | – |
Tennessee | State Portal | April 30 | Same as IRS | – | |
Texas | No | – | – | - | – |
Utah | If State Witholding | Same as IRS | US$ 0 | – | |
Vermont | State Portal | April 30 | US$ 599,99 | Vermont Withholding Account Number | |
Virginia | State Portal | April 30 | US$ 599,99 | – | |
Washington | No | – | – | - | – |
West Virginia | If State Witholding | Same as IRS | US$ 0 | – | |
Wisconsin | If State Witholding | Same as IRS | US$ 0 | Wisconsin Withholding Tax Number** | |
Wyoming | No | – | – | - | – |
I have to agree. I have a data base of my sales since I started in Microsoft Access, which isn't as hard to learn or program as one might think. And I do have a couple of things I track on Excel worksheets.
This has served be well for about 24 years. Now since Ebay has significantly upgraded the reports we can get, they make an excellent cross check for my numbers.
I encourage all sellers to NOT depend on Ebay reports only. Keep your own books and use them as a cross check.
@car_audio wrote:Is this article true saying it's delayed to 2024?
Meaning you sell more than $599 in 2023 you don't get the 1099K?
Google search this to make the article come up:$600 rule ebay delayed 2024 nasdaq"IRS Delays New $600 Reporting Rule for Gig Workers and Online Sellers to 2024: Here's What You Need to KnowIf you are working as a freelancer, gig worker or side hustler, don't panic in 2023. The IRS extended more time for workers and online businesses to report income on 1099-k form to 2024. The Coalition for 1099-k fairness is looking fighting the IRS' plans to report income of $600 or more. There's a belief from major online "
What Article @car_audio . So far the poster making this claim has not supported it with any link to any article. And the IRS site still says it is $600 for 2023.
Oh, I found the article you are referring to.
However I don't think you should count on this as the IRS has NOT updated their site. The article was written in February of this year and now we are in mid August. IRS has made no update to their site nor do I see any other articles saying what that article says. I think they just got their years wrong.
The good thing is the 1099K is MERELY a FORM and nothing more than a form. With or without this form we are all responsible to claim our income to the IRS every year. The form is merely informational.
While this is a document for IRS for 2022 tax year, there is some really good info in it for those people that are selling personal property and how to account for it.
https://www.irs.gov/pub/taxpros/fs-2023-06.pdf
Here is another one with helpful info.
https://www.irs.gov/newsroom/form-1099-k-frequently-asked-questions-general
