eBay

jessica7393 · ‎04-15-2016

I forgot to report my income tax in year 2014. IRS sent me a letter today saying I own them $8,xxx. in 2014, I received about $20,xxx on paypal in 2014

My incomes were coming from..

1. I never reached the $20,000 before but in 2014 year I sold many of my used brandname bags, and I never kept any receipts. (I sold my used brandname bags ~ $6000 in 2014 most of them were balenciaga bags that made in year 2007.

2. I sold many coach bags that I purchased from outlet before 2010. (I have been banned from coach since 2010, so I stopped selling and buying but I still have many coach bags left that I was too lazy to get rid of them. Later on, I started to sell them again in 2013 and reached $2x,xxx in 2014) I just sold them to get my invest money back not making a lot of profit from them as mostly of my coach bags were the old model.

Some that I bought online I still keep the emails but some I purchased for the store back in year 2006-- I never kept any receipts. but I still remembered the price that I purchased from the sale price.

I feel really regret that I neglected to check for the tax. Will IRS request me to show them all the receipts?

posting*master · ‎04-15-2016

@redbud_farm wrote:
... Few qualify for EIC that sell here , it's not wise to even file for it unless ...

I do it every year; It's the perfect supplement to Social Security.

johnwhiplash · ‎04-15-2016

Go to a bookkeeper or someone who knows how to file taxes and have them prepare an ammended return for you. Everything will probably work out ok for you, but you need someone who knows what they are doing to fix it for you.

redbud_farm · ‎04-15-2016

Ah but bet you have your ducks in a row in case of an audit. Many don't.

I've seen a few locally find out the hard way.

age is a measure of time , wisdom is the measure of how we used that time

sin-n-dex · ‎04-15-2016

@ki_korners wrote:
You're located in Thailand. Is the U.S. IRS?

(If not a scam) US Citizens pay taxes to the IRS, regardless of residency.

Cheers, C.

blackbird*singing · ‎04-15-2016

@takikawa4 wrote:
I'm sorry, but how do you forget to report income to the IRS???

An acquaintance of mine chooses not to file because he says, "I spent all of the money I earned." I still can't believe he takes that risk. He gets a 1099 instead of a W2 at his place of employment so no taxes taken out in advance. He should be putting aside money from each check that he owes for taxes. Instead he says, well i spent my earnings so I'm just not going to pay. He's in for a world of hurt if he ever gets audited.

sin-n-dex · ‎04-15-2016

@prefontained wrote:
@takikawa4 wrote:
I'm sorry, but how do you forget to report income to the IRS???
An acquaintance of mine chooses not to file because he says, "I spent all of the money I earned." I still can't believe he takes that risk. He gets a 1099 instead of a W2 at his place of employment so no taxes taken out in advance. He should be putting aside money from each check that he owes for taxes. Instead he says, well i spent my earnings so I'm just not going to pay. He's in for a world of hurt if he ever gets audited.

I'm a bookkeeper by trade (my own services I offer), and all my clients are bad risks financially... One paid his taxes (no withholding) and sent it to the wrong office, they send him a cheque back to refund him, he knew it was an error, but needed the money and spent it. Had a pickle of a time paying all that off, which he had to do, because they seized his bank accounts and he couldn't pay his mortgage.

Cheers, C.

threshold.sales.group · ‎04-15-2016

@prefontained wrote:
An acquaintance of mine chooses not to file because he says, "I spent all of the money I earned." I still can't believe he takes that risk. He gets a 1099 instead of a W2 at his place of employment so no taxes taken out in advance. He should be putting aside money from each check that he owes for taxes. Instead he says, well i spent my earnings so I'm just not going to pay. He's in for a world of hurt if he ever gets audited.

What happens when folks don't file and go the 1099 route to avoid garnishments is that eventually the company paying the guy as a 1099 contractor will get a letter from the IRS ordering them to stop paying him (as a 1099 contractor). It works for those folks for a bit, but eventually even if they don't have a bank account and transfer ownership of everything they own, the IRS keeps tightening the noose.

pananana-5 · ‎04-15-2016

This is the calm before the storm, where the mighty IRS army has informed you they are assembling for war. At this point they're merely shining up their weapons, soaking up some sun, the situation is far from serious but they are letting you know they're not backing down. Nobody can be entirely certain what sets the IRS in motion, but what is certain is the might of their institution.

Now you must make peace with the IRS and for that you need an IRS whisperer, also known as a CPA.

These IRS whisperers, they speak the language of the government tribes.

They can negotiate a peace treaty for you with the mighty chiefs of the tax department.

Or, you can go to war with teh IRS

Be prepared for a long battle that gets increasingly more difficult and most likely will utlimately result in defeat, yours that is.

So, get a CPA

gramophone-georg · ‎04-15-2016

@takikawa4 wrote:
@impalajohnny wrote:
@takikawa4 wrote:
I'm sorry, but how do you forget to report income to the IRS???
It's easy for people with small incomes that typically don't owe any tax to forget or not bother. The assumption on the boards is usually that those not reporting are "cheating". In reality many ebays sellers could file, pay nothing, and qualify for some free government loot via refundable credits like EIC. Not taking advantage of free money is hardly cheating.
Sorry, but I've never, ever forgotten to include potential income, even if it's below the level that's required to be reported.

It must be tough being perfect.

Chaos is NOT an "industry standard".

takikawa4 · ‎04-15-2016

How in the world did you extrapolate that I'm perfect because of ONE thing? Perfect has nothing to do with it. There are some things I don't forget. The IRS is one of them.

gramophone-georg · ‎04-15-2016

@takikawa4 wrote:
How in the world did you extrapolate that I'm perfect because of ONE thing? Perfect has nothing to do with it. There are some things I don't forget. The IRS is one of them.

Perfect, yet flawed. this won't end well.

Chaos is NOT an "industry standard".

toooldtorock · ‎04-16-2016

"If I sold them less than the price that I purchased, will I have to pay tax for the price that I sold? I do

have receipts for my brand name items."

If you sold them for less then what you paid for the items, you had no profit to tax.

It would be helpful if you could get regular retail pricing at the time you sold your Coach items for

which would demonstrate to the IRS the nature of what you were doing.

A clear explanation that you were not a business but just a collector unloading your impulse

buys would help. Maybe a female IRS agent might be more understanding.

The IRS many times gets nasty only if they feel you are trying to slide one by them.

cumos55 · ‎04-16-2016

Paypal is required to report all sellers on eBay that have more than $20,000 in Sales.

and... with Paypal all of the transactions listed include the cost of shipping.

--------------------------------------------------

The question becomes.

Did you buy it for your own use and then sold it at less than what you paid for it

Were you selling as a business or as a personal sale of personal items....

The sale of personal items... at a loss and it is not taxable....

-------------------------------------------

You definitely need professional assitance... and advice as to how to proceed.

toooldtorock · ‎04-16-2016

"Were you selling as a business or as a personal sale of personal items...."

Whether you sell as a business or just off loading personal items, a loss is a loss.

As a business you can take business deductions. As someone just selling impulse buys,

you would not be taking deductions like depreciation.

Granted, $20k in purchases and sales will take some serious conversations with the IRS to show

she wasn't running a profit making business. The OP should have a chat with a tax consultant.

threshold.sales.group · ‎04-16-2016

OP, if you recieved a 1099 that should have been reported no matter what. There's a question on the 1040's specifically asking if you've received a 1099 and if so, from who? If a 1099 shows up on your soc sec # the irs system first looks to see if it's been reported. If it's not being reported as 100% income, then they'll look for a schedule c.

IMO, claiming $20K plus sales with multiple transactions resulted in loss *that wasn't reported on a schedule c* isn't going to pass the red face test and is going to be a tough hill to climb. Of course YMMV.