social security

[irishgirl0117]

Does social security have the right to garnish your benefits from selling used personal items?

[dhbookds]

I don't think Soc Sec makes any decisions as to garnishment.......that would be the IRS......

Just an experience that I read about .......clothing seller tried to claim in court that she was just selling "her clothes".......Prosecution showed she had 1000's of items up and had sold 1000's over several years.....  She lost the case......

[comics-scifi-collectibles]

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@irishgirl0117 wrote:

Does social security have the right to garnish your benefits from selling used personal items?

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You should ask a CPA this question.  If I am understanding you correctly you are talking about the limit on the amount you are allowed to earn while receiving social security benefits when you are 65 or younger.  

ANY income counts towards that maximum allowed amount before they start taking back part of your income.       You are supposed to declare all income on your taxes no matter the source.  Be sure to deduct item cost, shipping expenses etc from your gross.       

This is from google: If you're younger than full retirement age during all of 2020, we must deduct $1 from your benefits for each $2 you earn above $18,240.

[jack_bucks_ghost]

unfortunately, I would guess yes. if you google the question, there seem to be quite a few eBay discussion forum posts that discuss it--you might check the forum archives. good luck!!!

[myboardid]

If you don't pay your taxes, the gov't has the right to garnish your income.  They can also take your assets.  Get yourself a tax attorney who specializes in your situation.

[simba6]

If you cross the line into business then you do have to pay your taxes or else.

[powell-memorabilia]

Yes, they do.  If you owe the IRS, you can actually be obligated to sell off your used.

[jack_bucks_ghost]

here's a pretty thorough summary of when SS can garnish wages due to overpayment. it's a bit dated, but I can't imagine they have relaxed any guidelines regarding getting money back:

https://rrtc.vcu.edu/webcast_archives_barc04/wagegarnishment.pdf 

[angswe_60]

If you earn anything above their cut off, yes

[pburn]

@comics-scifi-collectibles wrote:

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@irishgirl0117 wrote:

Does social security have the right to garnish your benefits from selling used personal items?

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You should ask a CPA this question.  If I am understanding you correctly you are talking about the limit on the amount you are allowed to earn while receiving social security benefits when you are 65 or younger.  

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I agree that this is exactly what the OP is asking--nothing about income tax or IRS--strictly whether Social Security benefits can be reduced based on income from eBay sales. (The OP's use of the word "garnish" is a bit misleading, IMO. "Reduce" would have been a more accurate choice.)

OP should contact Social Security or a tax advisor to establish whether proceeds from eBay transactions are defined as "income" as defined by the Social Security guidelines. A tax advisor could also assist the OP with potentially reducing gross income, since Social Security will base their calculations on net income.

I would just clarify that it's not necessarily at age 65. It's the age at which an individual qualifies for what is referred to as "full retirement age" or FRA. My FRA, for example, is 66-1/2. I believe you're younger than I, so your FRA may be even older . . .

Good answer.

[pburn]

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@jack_bucks_ghost wrote:

here's a pretty thorough summary of when SS can garnish wages due to overpayment. it's a bit dated, but I can't imagine they have relaxed any guidelines regarding getting money back:

https://rrtc.vcu.edu/webcast_archives_barc04/wagegarnishment.pdf 

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That document's a good resource--if the OP is still a wage-earner and has wages that could be subject to garnishment.

I think, however, the OP was asking about Social Security benefits being clawed back (rather than "garnished") or reduced based on income from eBay.

[nobody*s_perfect]

Social Security says: "If you are under full retirement age for the entire year, we deduct $1 from your benefit payments for every $2 you earn above the annual limit. For 2020, that limit is $18,240."  So even before you start deducting anything or wondering whether you can deduct the original price that you paid, you'd have to be among the rare small eBay sellers who take in over $18K per year, before SS started deducting.  Here's the Social Security page which seems to address your question:

https://www.ssa.gov/benefits/retirement/planner/whileworking.html

If you sell items for less than you paid for them, then there is no net profit to report.  Take a look at IRS Schedule C and its instructions, to see how they look at this. You can deduct not only expenses like postage and eBay/PayPal fees, but also the cost of the goods sold (commonly abbreviated as COGS). If your net income is negative (from selling items at a loss) then you have no income to report from the IRS perspective, either.

You might even be eligible to received Earned Income Tax Credit; look up EITC.

On the other hand, with over 1000 active listings, and with 400 feedback as a seller in the past year, you might have trouble convincing SS and the IRS that these are all personal items.

[soh.maryl]

The OP is in no way referring to income tax or the IRS.

When you are drawing Social Security, but still working at a paid job, there will be a limit to how much you can earn before Social Security limits your SS or makes you pay some back.  This affected me back when I was still working, but drawing SS, but I cannot recall exactly  how it worked.  

[pburn]

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@nobody*s_perfect wrote:

. . . you'd have to be among the rare small eBay sellers who take in over $18K per year, before SS started deducting.

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Unless the OP has qualifying income from other sources in addition to eBay income, such as wages or other qualifying income from self-employment.

[chapeau-noir]

Yes - a lot of people don't sell just on eBay anymore. I'm a part-timer who makes over the threshold with online sales so I have to pay taxes on my net income, but the claw-back doesn't happen because I'm past retirement age.  For personal items under fully vested retirement age it's still the net income that would be considered.