Reporting eBay Income For Tax Purposes

[soh.maryl]

Personally, am no longer a seller, but here's just one thought from a seller's perspective:  If every seller who claims they have plans on leaving because of their outrage about reporting eBay income does actually leave, doesn't that mean less competition for the guys who decide to stick around? 

[jklfindings]

Yep.  Probably gonna be a great year for some sellers!

[downunder-61]

It means even more than that, it levels the playing field quite a lot with especially with business sellers.

As a seller who has always declared my eBay income - that tax % is built into my price, the seller who does not pay tax can undercut the prices of those that do because they do not have the additional tax burden. If I chose to not pay and evade the tax man I could reduce my prices as well.

And this is why there is little to no sympathy for the ones who come here spouting off about how unfair it all is - and how they are leaving, boo hoo - because we have been paying our taxes due for years.

[jklfindings]

It's certainly going to be interesting to see all the side effects of this.  Someone on another post mentioned how a 1099 is going to decimate some people on federal / state assistance programs.  That extra income is going to push people into higher tax brackets, and I'm sure for some, push them out of that income range to get assistance.  People doing "side hustles" are going to some degree be removed from the market, and small businesses are going to rush to fill that gap.  It will certainly be an interesting time period lol.

[luckythewinner]

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@soh.maryl wrote:

Personally, am no longer a seller, but here's just one thought from a seller's perspective:  If every seller who claims they have plans on leaving because of their outrage about reporting eBay income does actually leave, doesn't that mean less competition for the guys who decide to stick around? 

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A couple hundred sellers out of 20 million is not all that much.

Plus, some of the ones complaining were also complaining about not getting many sales and/or not paying their taxes in the past. 

[m60driver]

I highly doubt that the number of small sellers who will leave Ebay because of their outrage against "the guberment" will make a dent in competition for the rest of us.

[blingfling123]

I think the real fall out is going to happen in Q1 of 2023. 

A number of things are going to happen

People that do not pay attention to anything are going to start getting 1099s and flip out.   

People that do know they are going to get one, but don't realize how much taxes you have to pay on self-employed income are going to flip out. 

People that have been double dipping/not reporting are going to be penalized and possibly loose benefits are going to flip out.

I also predict that there will be posts from people who have relatives using their information because the original account holder was banned posting about IRS notices about income discrepancies because someone is using their information. 

All of the above happened when MA and VT went to $600 reporting although it was on a much smaller scale. 

[itsjustasprain]

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@m60driver wrote:

I highly doubt that the number of small sellers who will leave Ebay because of their outrage against "the guberment" will make a dent in competition for the rest of us.

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True. Plus I highly doubt that very many sellers who are loudly declaring that they will leave are actually going to do so. If you go to their profile and look at previous replies you often see that they have been threatening to leave for years in outrage over something or other. When if you have been filing properly in the past this will make no difference at all on your taxes.

Its a little like shopping at Walmart these days and seeing some guy wandering around with no facemask and practically daring the store to make him put one on. I just think 'okay - fine - whatever - do what you like. I will still be here after you are gone'. I take that same attitude with my selling account here. I sell stuff - file my deductions against the 1099 each year - and if there are actually going to be fewer sellers here in future thats fine by me. Win-win all around - right?

[katzrul15]

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@soh.maryl wrote:

Personally, am no longer a seller, but here's just one thought from a seller's perspective:  If every seller who claims they have plans on leaving because of their outrage about reporting eBay income does actually leave, doesn't that mean less competition for the guys who decide to stick around? 

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It would be nice if they went quietly, closed their stores/listings.

Really a bigger picture issue.  They will sell on FB mktplace or CL, pay no taxes, collect their sale in cash - cheat FB of zero fees by claiming it did not sell, etc. 

Bigger Societal fail.  If you are dumb enough to cheat on your taxes, you cheat/cut corners elsewhere as well.  The entire "ME" syndrome is tiring.

For each one who leaves, 2 likely sign -up and take their place.  Selling Chinese mass-produced wares or whatever. 

[maxine*j]

Indeed it does.  And the tax evaders had a substantial and unfair advantage over those of us who play it straight, too.  Plus buyers will have the advantage of dealing with honest people who run their small businesses accordingly. 

=

[buyselljack2016]

A few grains of sand missing from the vast eBay beach will go unnoticed.

Even a scoop of sand becomes undetected after the next wave come in.

As I once heard it explained.  

Put your hand in a bucket of water. Observe.

Take your hand out of the bucket. Observe.

The size of the hole left in the bucket of water equals how much you will be missed.

[divwido]

Not much of a threat, is it?   And this isn't just eBay, this is EVERY SINGLE online selling site.

[duffy4444]

   Yes! Less competition for us who stick around, and less competition for those of us who have been reporting our sales activity all along, even when we didn't meet the older, higher 1099k threshold.

    I welcome less competition from low-ballers who were evading income tax reporting laws and were able to undercut my prices because of it. It's about time.

Cheers, Duffy

[slati_2013]

I am more interested if it brings an end to the crazy prices bid on some auction sites where many of us get stuff to sell. Some of the bidding prices make no sense.

One seller I know from our bidding wars outbid me by thousands of dollars then promptly put up all the items and sold them all before the end of the year. He made a huge profit, but if he had been patient, he could have made three times the profit. All his listings are now gone. Hundreds of them. 

[duffy4444]

   Of course, it will be a drop in the bucket in the long run, but at least it makes me feel better knowing the playing field is getting more level with honesty is being forced upon the tax evaders.

 - Duffy