Internet sellers who don't report their sales will no longer be under the radar. Starting next year, any bank or other payment settlement company that processes credit cards, debit cards, and electronic payments such as PayPal will have to issue information returns telling the IRS what merchants receive. The new returns are Form 1099-K, Merchant Card and Third-Party Payments.
Exception: Very small merchants won't be issued information returns. "Small" for this purpose means annual gross sales on merchant cards of no more than $20,000 or 200 or fewer transactions. In other words, reporting is required only if gross amounts for the year exceed $20,000 and there are more than 200 transactions.
I fall into this category, which I would think alot of casual sellers do.
Very small merchants won't be issued information returns. "Small" for this purpose means annual gross sales on merchant cards of no more than $20,000 or 200 or fewer transactions. In other words, reporting is required only if gross amounts for the year exceed $20,000 and there are more than 200 transactions.
So the way I'm reading this is: if you sell under $20k a year on eBay, you won't be required to pay taxes on it? Are eBay/Craiglist sales already non-taxable if they are under a certain gross amount per year?
1chris1 said: So the way I'm reading this is: if you sell under $20k a year on eBay, you won't be required to pay taxes on it? Are eBay/Craiglist sales already non-taxable if they are under a certain gross amount per year? taxable but not reportable
DaGimp said: videogamesaremylife said: Yes income from all sources must be reported to the IRS. Right now paypal is not required to report it.
Sometimes it's not really "income" as a casual seller of items that you already own.
Take your used car that you paid in full 5 years ago for $10,000
You sell it and get $5000 for it. You are not entitled to report that $5000 as income.
correct me if I'm wrong- while technically its not income if you sell something you paid $50 for for $25...but you have to be able to prove that you bought it for $50 initially- problem is most of the items I've resold I haven't kept my original receipts- I'm likely not the first one.
DaGimp
Member
posted: Mar. 11, 2010 @ 9:44a
wp746911 said: DaGimp said: videogamesaremylife said: Yes income from all sources must be reported to the IRS. Right now paypal is not required to report it.
Sometimes it's not really "income" as a casual seller of items that you already own.
Take your used car that you paid in full 5 years ago for $10,000
You sell it and get $5000 for it. You are not entitled to report that $5000 as income.
correct me if I'm wrong- while technically its not income if you sell something you paid $50 for for $25...but you have to be able to prove that you bought it for $50 initially- problem is most of the items I've resold I haven't kept my original receipts- I'm likely not the first one.
It's kind of like, if you found $100 on the floor would you pick it up and report it to the IRS? I wouldn't, i'll be at the first bar that's on the way home and that $ would be put into the beer stimulus.
wp746911 said: DaGimp said: videogamesaremylife said: Yes income from all sources must be reported to the IRS. Right now paypal is not required to report it.
Sometimes it's not really "income" as a casual seller of items that you already own.
Take your used car that you paid in full 5 years ago for $10,000
You sell it and get $5000 for it. You are not entitled to report that $5000 as income.
correct me if I'm wrong- while technically its not income if you sell something you paid $50 for for $25...but you have to be able to prove that you bought it for $50 initially- problem is most of the items I've resold I haven't kept my original receipts- I'm likely not the first one.
You don't need a receipt for something that you paid more for after you sell it for less,(unless you sell over $20,000 of used items on eBay which is very unlikely for most people) because you are not going to be able to write it off as a loss anyways, and they don't check for things that were sold for less than you bought them for.
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