Sales Tax collected by Ebay for 2019

[chic2chicetc]

I am a small time seller, selling items I own, not purchased for resale.  I have tried to research what my responsiblity is for sales tax Ebay has collected on some of my sales.  Is Ebay actually reporting to each State for tax collected or am I responsible for reporting/remitting the tax? 

I did go to Paypal and print each sales, which showed sales tax for my records, which took awhile, even though my sales are under $5K.  When did Ebay actually begin to collect sales tax?  If they are collecting and not reporting, surely, they will include in the monthly sales report.  Thanks everyone for the help! 🙂

[webpresents]

Best I can tell, is eBay is handling it. It started over the summer. I thought it would only be for items purchased by those living in my state (the state sold from and only if shipped to a buyer within the same state). However, it happens that sales tax is automatically taken from all of my sales now and it is taking a bite. We are responsible for collecting and submitting to sales in our own state prior to this change as I see it. You may ask your tax preparer.

[webpresents]

Oh and now I reread and see you are selling items from your possession as opposed to as a business for resale and profits. Ask your preparer if you can recapture the sales tax. My guess is that would send out a red flag but since there is no profit involved and you are selling depreciated goods, that would be a great question to ask. My understanding is those sales to not get income taxed since they are bought high and sold low.

[nobody*s_perfect]

eBay collects the sales tax and also takes care of submitting it to the states. You don't have to do anything ; it's all automatically handled by eBay under the new "marketplace facilitator" laws that have gone into effect for 35+ states.

https://community.ebay.com/t5/Announcements/UPDATE-Ongoing-Changes-in-How-Internet-Sales-Tax-May-Imp...

https://www.ebay.com/help/selling/fees-credits-invoices/taxes-import-charges?id=4121

[nobody*s_perfect]

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@webpresents wrote: .... My understanding is those sales to not get income taxed since they are bought high and sold low.

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That has nothing to do with sales tax.

[laurabeardsley]

One more question. Does my total sales on paypal show the inclusion of the sales tax and does that mean I should deduct that amount of the sales tax off my total paypal when reporting income or has Ebay already taken that out before it goes to paypal?

[1786davycrockett · Accepted solution]

Since eBay is collecting the sales tax on each transaction, this is not effecting your profits from the transaction, since the seller never possesses the sales tax -- the sales tax is IN ADDITION to the selling price, and NOT deducted from the selling price.

As others have stated, eBay (as the market facilitator) is in charge of collecting and reporting the sales tax, and there is NOTHING for the seller to collect or report.

[evry1nositswindy]

On the PayPal report, the tax is added into the total (yes, our fee is calculated from the tax total) and then it shows as a negative going out.  This balances out to zero...except for the 2.9% we were charged on the tax.  

[chic2chicetc]

Thanks, everyone! I should have researched here and saved 200 sheets of paper and ink..Have a great day!

[evry1nositswindy]

@chic2chicetc Me too 😞 I printed what I thought was the right report, when it really was not and I wasted so much paper! I didn't know how to stop it. After it was done, hubby came in and said why didn't you hit ctrl s to stop printing?? Well, learned something new because I didn't know that. Found the right report and it was only 2 pages!

[laurabeardsley]

So the total that paypal sends into the IRS includes the tax ? Then I have to deduct this amount from my gross earnings to get my net? Sorry for asking this question so many times, just trying to get it right.

[mightymouse]

OK here is my take on this tax issue. I use paypay for Ebay, antique shows and in my mall space. The amount reported is ALL items on the charge, sales, shipping and taxes. I get sales reports from the mall space, from Ebay and keep my own from the antique shows. which are sales only (no tax and no shipping). If you rely on Paypal for all your income reporting you have to keep other records to back out no sale items. That is way too much work. Ebay sales reports show just sales, so if you print shipping or just go to the PO for shipping you get a receipt for it.  If you collect shipping you add it in to the ebay sales then you back out your costs for shipping. You have to keep records of cost otherwise you would be claiming all for taxes (why would you do that?)  Remember that Paypal is keeping records for total credit card transaction NOT sales.  

[russell20]

I started doing my Washington State business taxes yesterday. Ebay is what's called a market place facilitator. They collect and remit the sales tax to Washington State on my behalf. I have to collect and remit sales tax on any other sales I make such as at swap meets, flea markets, antique malls, yard sales, etc. The problem is that to balance the books on the state business taxes, I have to know how much eBay and other market place facilitators collected and remitted. I've been trying to figure out an easy way to get the total tax amount eBay remitted for me from 2019.

[buyselljack2016]

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@webpresents wrote:

Oh and now I reread and see you are selling items from your possession as opposed to as a business for resale and profits. Ask your preparer if you can recapture the sales tax. My guess is that would send out a red flag but since there is no profit involved and you are selling depreciated goods, that would be a great question to ask. My understanding is those sales to not get income taxed since they are bought high and sold low.

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Recapture the sales tax????   Seller did not pay any sales tax.

To determine profit for income tax a record(receipts) of profit/loss may need to be proven.  Not just say I paid $50 for the item, and sold it for $20 minus expenses.

[smashingbuys]

I read on Ebay that the sales tax collected is included in our total sales for 2019 shown on our 1099.

If this is true, then where can we find year end totals of the amount of sales tax that ebay collected in 2019!

Thank you