So I will have to pay the IRS for selling over $15k of my comic book collection on ebay this year?

[cerealjedi]

Not sure how this works but the future worries me. I AM NOT a reseller. I just sell stuff in my collection, toys, comics, etc and I do spend a lot on eBay as well.

So will I get a 1099 form? Will I have to pay the IRS?

[cerealjedi]

My father mentioned the same type of thing to me. Also just based on what I spent, I have probably lost at least $2000 on all sales regarding comic books on ebay since early 2021, based on what I paid at Comic shows, flea markets, etc.

[lacemaker3]

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@cerealjedi wrote:

My father mentioned the same type of thing to me. Also just based on what I spent, I have probably lost at least $2000 on all sales regarding comic books on ebay since early 2021, based on what I paid at Comic shows, flea markets, etc.

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Based on the new information you have provided, you would probably be well advised to start considering this as a business, because you may need to rely on income from online sales for a while.

Your biggest obstacle at the moment is the lack of records, so you can start keeping records now, to put your business on a good footing. You can start by researching what the fair market value of your comics were when you acquired them. You can go back through your bank statements, card statements and check book, and look for payments that were made to businesses that would have been your comic purchases. You don't need to know the amounts for each item individually, a gross amount paid, broken out by year, would be a good start.

The next thing to do, is to start thinking and acting like a business, and do things that will maximize your future profits. As I said before, selling collectibles/possessions to raise capital to start a business is a good way to get started, and the IRS recognizes this. They expect new businesses may operate at a loss for a few years (up to 3 years is often given as a maximum). Selling collectibles now, at a loss, is a good way to get a positive cash flow (capital) that you can use to fund the business.

So, make sure that you are not siphoning off all of the income now (for living expenses). You need to be funneling some of the income back into the business (in order to get some future profits). If you are not making decisions and doing things that can be expected to result in future profits, then you're not running a business, and your business expenses may be rejected.

[radioindy]

Yes, you will get a 1099 from eBay; it's the same as declaring over $600 income from a garage sale or what have you (and is not a new regulation, just the enforcement is new). BUT! You will also have expenses from selling: postage, cost of mailing supplies, printer ink, paper, even the electricity if you use a dedicated room for your eBaying (home office, etc.- to figure it, you divide a monthly bill by the number of rooms in your home to determine how much for one room; you can also declare phone & internet services as monthly expenses. Basically, *anything* you spent money on in the course of doing your eBay sales can be declared as an expense, not just cost of inventory.) It can help to have an accountant to help do your taxes in these cases. I actually have a great accountant who determined back when I was self-publishing comics, the actual backstock comic inventory we held *depreciated* in value over time as they counted as periodicals! (In Texas, you have to pay yearly taxes on unsold inventory- that depreciation clause really helped us out here! It also helped to count as an expense when we did our federal taxes.)

As others have said, keep track of expenses (I use a notebook for each year and give the final totals to my accountant; an Excel form works too), and save ALL receipts (I put everything in a box with the year written on the side; if the IRS ever audits me, they get the whole box as-is; they can sort it themselves.) If you had a professional grade your collection for insurance purposes at any time, you can use that information as the "what you paid" for the collection cost number. I too am just selling my personal collection now on eBay, but I have continued to use all these tricks my accountant taught me for keeping track of expenses.