Venmo

[12345jamesstamps]

Just a heads up...

Venmo is the same as eBay and Pay Pal where as after $600. sold  IF...if it changes this year from the $20,000. mark in California to $600...there will be a 1099K. For those states with a very sad limit look out.

[gone.c-33]

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@kalyoth wrote:

For those confused: the 1099K is 100% driven by each funding source origin.

ebay is not the named party for any payment made by a buyer on the ebay platform. Each seller is the named recipient of money paid by a buyer on the ebay platform. Managed payments are not some mysterious & uniform new alternative currency system. ebay charges their fees to your individual account after you receive the funds from the buyer into your account.

ebay acts as a central transfer agent (or exactly like Paypal - they founded PayPal afterall) for payments or refunds - like every other bank accredited to process payments. Each & every payment type is it's own 1099K form with a running total. Congress was quite specific when they also included cash apps in that reporting change to pay for the COVID Stimulus years ago. Money received from Paypal (all sources of funds - credit cards, gift cards, random cash etc.) are one, Venmo is one, credit cards directly processed by ebay collectively are one, etc. etc.

Expect many forms to file if you are a very successful seller meeting the limit across the year.

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Wait, are you saying eBay sellers receive one 1099 for PayPal payments, one 1099 for credit card payments, one 1099 for ApplePay payments, one 1099 for Google Payments and so on???

[kalyoth]

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@mam98031 wrote:

"The IRS & the law consider the funds the moment they become realized by you. Your realization occurs when you sold the merchandise, not when you finally receive funds into your possession."

For businesses that are using accrual accounting, this would be correct, but those using Cash accounting it would not.  With that said, 1099Ks are solely and ONLY for cash received before any deductions are taken by anyone.

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If you sell merchandise - that is realize a transaction - within a calendar year, if an agent, such as a marketplace, collects said proceeds & transmits them to you in a future year, your tax implications still fall upon that 1099K for the year the transaction funds transmission from buyer to agent occurred. When I match up the raw transaction data from ebay monthly, those taxable totals, pre-deductions, have equaled the 1099K for 3 years now.  That includes all the transactions that happen in the last 7 days of the year in December through 12/31. It has been a nice backup to my own ledger records. Also makes starting taxes in February much easier. If it's one thing I HATE, it's late paperwork.

[mam98031]

@kalyoth 

Thank you for the concern.  I do know how to account for my sales on my income taxes, I've been doing it for 25 years, long before 1099K's even existed.  So I'm good on that.  All my income gets reported as it is suppose to be.

[kalyoth]

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@robbie31415 wrote:

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@kalyoth wrote:

Not true - each payment method is coming to the seller by name. Doesn't matter if ebay is clearing it all - still in the sellers name for receipt. So it 100% impacts you.

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This is clearly wrong.

But you can go ahead and believe whatever you think im not going to argue since you don't want to understand how the process is. It's been explained properly by multiple people.

Funny that is a post Mam liked. Shows more how misguided they are.

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Considering that my degree as an Accountant has yet to cause filing questions by the state of MA Department of Revenue since my first filing year of 1984, well known to seek every penny due them, my current filing accountant has not found fault in said US Tax law for the 15 year relationship nor have I been audited by the IRS for following US Tax Law, I will trust in the tax laws that certify my ability to perform the work, regardless if I agree with them or not.

Are there multiple methods of thought, belief or attempts at understanding the tax laws? Yes. The only way to know for certain if you are right or wrong, is when you receive your Audit Notice. Otherwise, you fall through the cracks. But, when tax liability is at stake for a government, you better believe they will come looking for it - or else you'd not see the tens of thousands of lawyers getting rich off attempts to settle tax debt with the IRS.

[kalyoth]

Too true. I often forget that tiny private ownership period of 3 months after going public before ebay acquired it for 1.5 billion in an all stock purchase. Been a while since I had to review my old shareholder annual reports 😄 Thank you for reminding me. I'm still trying to sort out if retaining that Paypal stock when ebay spun them off is worth retaining or is their day in the sun over. Been a rocky couple of years for them.

[dbfolks166mt]

@mam98031 wrote:

"The IRS & the law consider the funds the moment they become realized by you. Your realization occurs when you sold the merchandise, not when you finally receive funds into your possession."

For businesses that are using accrual accounting, this would be correct, but those using Cash accounting it would not.  With that said, 1099Ks are solely and ONLY for cash received before any deductions are taken by anyone.

If you sell merchandise - that is realize a transaction - within a calendar year, if an agent, such as a marketplace, collects said proceeds & transmits them to you in a future year, your tax implications still fall upon that 1099K for the year the transaction funds transmission from buyer to agent occurred. When I match up the raw transaction data from ebay monthly, those taxable totals, pre-deductions, have equaled the 1099K for 3 years now.  That includes all the transactions that happen in the last 7 days of the year in December through 12/31. It has been a nice backup to my own ledger records. Also makes starting taxes in February much easier. If it's one thing I HATE, it's late paperwork.

     What you state may or may not be true but it depends on, as  @mam9803  noted, whether you use cash or accrual accounting when you do your taxes. It is one thing you have to declare on  your schedule C and it needs to remain constant from year to year. 

     With accrual accounting revenue and expenses are counted when the revenue or the expense occurs regardless of when the cash flows. It is generally the easier method to use especially when it comes to expenses. 

     With cash accounting you count revenues and expenses as the cash is received or actually paid. With cash accounting and revenues it is possible that revenue from certain sales in the last week of the calendar year may not be realized until the next calendar year depending on when the funds are actually deposited in your account. For expenses it can become even more complex. If you use  CC to purchase an item in December depending on your CC billing cycle and how you make the payment the expenditure may not be realized until the next CY. If you pay the CC by check it's NOT the day you send the check it is the day the check clears the bank and the funds are taken from your account. 

[mantle1951]

I don't know if it is Venmo or not but since Ebay started accepting I am getting almost 1 or 2 sales a day.

Yeah!!!!