Ebay needs your social security number in order to report your "income" to the IRS and, yes, you should feel very uncomfortable leaving your social security number anywhere no matter how reputable the organization. Your social security number is the key to your kingdom and the more keys you leave lying around, the more likely something really unpleasant will occur.
Of course, the only reason why eBay needs your social security number ultimately is because eBay decided to force you into a managed-payments-or-nothing situation. Either fork over the social security number or forget selling on eBay. If eBay had left the managed payments system as an option, then it would not need your social security number unless you chose to participate in the managed payments system. Why should eBay have worried that you would not participate? Afterall, eBay constantly has been saying how advantageous the managed payment system is for everyone. Yeah, right. Many people even will defend eBay's position, saying the Company has no choice because of IRS requirements, which is true, but it's pretty weak to say that eBay has been forced into obtaining your social security number when it was eBay that chose to force all of this upon you to begin with.
Go along with it or get lost. I ceased selling last April and I've always reported my "income" to the IRS.
