The requirement to pay taxes on profits you make from selling stuff isn't new. Companies like Ebay (and Etsy, Paypal, Venmo etc.) being required to report your earnings to the federal government is new.
This can seem really overwhelming if you've never included these sales on your taxes before. A lot of people are posting questions asking why they should have to pay taxes on things they already own, why they have to pay taxes on the amount the buyer paid for shipping, etc. All the information about what to do with the 1099-K when you file your taxes, and what amounts are considered taxable income by the federal government are on the IRS website. A good starting point would be to look at the instructions for IRS schedule C https://www.irs.gov/pub/irs-pdf/i1040sc.pdf Even if you don't consider yourself to be running a business, the IRS might, so read up on what income the require to be reported on your tax form. Also, if you use tax prep software like TurboTax, the software will walk you through this. If you really don't understand what you need to report you can always consult a tax professional, but there ARE cheaper ways to find the information on your own.
The good news - and the reason that the feds are requiring this reporting - is that you can use your 1099-K as evidence of income and self-employment. And if you report your sales as business income, you pay social security and medicare taxes on it, which gets credited toward your social security and medicare eligibility. Yes, this is an additional pain that occasional eBay sellers didn't anticipate, but you can navigate through it.
