One note about the 1099

[dbfolks166mt]

     There have been a number of posts recently about the 1099 reporting threshold and eBay's messages and attempts to get the federal government to raise the reporting threshold from the current $600 to some xx figure. I won't dwell on that quagmire but one thing to remember is even if the federal threshold is raised there are a lot of states that have their own individual 1099 reporting threshold laws and some of those took effect well before the federal law was enacted. 

     So even if the effort to change the federal requirement is revised that may not change the state requirements and in fact could possibly compel the individual states to pass their own laws on 1099 reporting thresholds and you could possibly wind up with 50 different reporting requirements and levels. Not unlike the way each state has it's own sales tax laws. 

[mr_lincoln]

@dbfolks166mt 

Personally I think the lower threshold is fine ... 

[fern*wood]

It's crazy.  Reporting taxes has always been the law.  My friend was audited and had to pay back taxes for not reporting her ebay sales, and this occurred prior to ebay sending 1099ks for any amount.  That form doesn't change anything about our obligations regardless of the threshold. 

[mr_lincoln]

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@fern*wood wrote:

It's crazy.  Reporting taxes has always been the law.  My friend was audited and had to pay back taxes for not reporting her ebay sales, and this occurred prior to ebay sending 1099ks for any amount.  That form doesn't change anything about our obligations regardless of the threshold. 

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I agree @fern*wood   well over 100%.  And how many threads have been posted where Sellers complain that NOW they have to pay taxes ... sorry, they should have been doing it all along like many other people.

[conservitvs]

I've been dutifully paying tax on my eBay profits every year since I started selling.

It's about time the tax cheats are held accountable.

I have NO sympathy for those bellyaching over the 1099s and having to now pay their fair share.

[mikhirs]

I passed my state's limit in 2021  (the year I started selling)  but ebay never sent me a 1099.  I had requested one and passed the "know your customer" thing.  They said they'd send one, but that never happened, neither electronically nor in the mail.  Had to go by my own records to do my taxes.

[mr_lincoln]

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@conservitvs wrote:

I've been dutifully paying tax on my eBay profits every year since I started selling.

It's about time the tax cheats are held accountable.

I have NO sympathy for those bellyaching over the 1099s and having to now pay their fair share.

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@conservitvs 

I am in full agreement and nicely put by the way.  I think what this might do is deter some people from Selling online who probably shouldn't be in the first place.  And  notice I said "online" not just eBay.

[a_c_green]

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@dbfolks166mt wrote:

So even if the effort to change the federal requirement is revised that may not change the state requirements and in fact could possibly compel the individual states to pass their own laws on 1099 reporting thresholds and you could possibly wind up with 50 different reporting requirements and levels.

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I don't quite see how... I'm only living in one state...

[nobody*s_perfect]

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@mikhirs wrote:

I passed my state's limit in 2021  (the year I started selling)  but ebay never sent me a 1099.  I had requested one and passed the "know your customer" thing.  They said they'd send one, but that never happened, neither electronically nor in the mail.  Had to go by my own records to do my taxes.

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Interesting. My state reduced the threshold to $600 effective in 2018, and I got a 1099-K from eBay for that year.  But the Arkansas threshold was $2500.

[dbfolks166mt]

@dbfolks166mt wrote:

So even if the effort to change the federal requirement is revised that may not change the state requirements and in fact could possibly compel the individual states to pass their own laws on 1099 reporting thresholds and you could possibly wind up with 50 different reporting requirements and levels.

I don't quite see how... I'm only living in one state...

     Understand that and so are most people unless they move during the year, contemplate that mess for a minute or so. So if the federal reporting limit was to change while you may not get a 1099 because of the federal 1099 threshold you may get one because of the state you live in and the state's reporting threshold requirement. I have been getting 1099's from eBay, Venmo, PayPal and several other third party financial processors since 2020 due to the lower Virginia 1099 reporting requirements. 

     Of course it has never been a big deal to me other than serving as a check against my own records since I always paid taxes on my net earnings anyway. 

[a_c_green]

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@dbfolks166mt wrote:

Understand that and so are most people unless they move during the year, contemplate that mess for a minute or so.

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Well, I'm still not seeing a mess here; it's eBay's responsibility to issue 1099s, not me. If I sold from one state during one part of the year and then moved to another state after that, I would expect two 1099s, each containing data on the sales relevant to that state. I would still be declaring the same total income anyway, with the same total deductions, on one Schedule C. The fact that I have more than one 1099 should not matter, since the totals are the same regardless of whether they originate from one location or several.

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@dbfolks166mt wrote:

Of course it has never been a big deal to me other than serving as a check against my own records since I always paid taxes on my net earnings anyway. 

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Likewise; yes.

[mikhirs]

It makes no sense, does it?  I wonder if ebay's accounting dept.  got overwhelmed and never got around to sending out all the 1099's.