E Bay sellers beware

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I hope that $600 figure gets raised at some point. In my world, I should send out a 1099 to anyone I pay more that $600 to in a year. I pay more than that to the kid that mows for me each year. Same with the cleaning lady that helps me. I'm not going to send them a 1099 and have them pay taxes on what I paid them.
Lets all hope for a change in the laws.

 

Stop before you get to 100%

"It's 1 for you, 19 for me"

 

What do you define as "well paid"? If you are paying 30% on your AGI then your adjusted income is over $165,000.

 

Our Government!!!!

 

I’m guessing that a lot of what is sold on eBay (coins plus everything else) is sold at a technical loss. It was something bought in the past and is currently of no use to the seller, so it goes on eBay at a fraction of acquisition cost. With decent accounting, losses and gains on eBay may be reportable as business losses and gains rather than capital losses/gains on collectibles. This allows a host of business expenses to be deducted from what is sold.

Given the shortage of IRS auditors, IRS will probably be very careful whom they audit … likely, high dollar sellers. They’ll probably find that if they audit smaller sellers who fail to include proceeds from a 1099K that they (the IRS) are losers when acquisition costs and other expenses are subtracted from sales proceeds.

However, their automated system may notice that proceeds from a 1099K weren’t included on a return, and a letter asking for tax on the entire amount may be sent. Many folks may meekly pay it, whereas if they considered acquisition and other costs, the IRS might owe them money. If enough folks do proper accounting, IRS might not even check whether low dollar amount 1099K proceeds are included on returns. Why start an audit if they’re likely to lose money in the end?

Cal

 

I have been wondering how this works. How do you do the math on this? Do you only report the coins you made a profit on and ignore those coins that you had a loss on?

 

I think there are two separate covid relief stimulus funds we are talking about. There were those little ones that we automatically got in the mail for 1 - 2 years and then there are those that you have to specially apply for, such as mortgage relief, small business relief, etc.

I received like three covid stimulus checks over the 1 - 2 year period of time and when I had my taxes done each year, the tax preparer specifically stated that ithese covid stimulus checks that I received automatically are not taxable.

However, it may be that the covid stimulus checks that small business owners specifically applied for and received to help them through the situation may be taxable, and same with the covid stimulus checks used to pay mortgage that home owners specifically applied for and received. I wouldn't be surprised if that's the case.

 

I'm almost sure (as much as I'm ever sure about tax-code questions, which is "not that much") that you can offset things like grading costs, postage, and packaging supplies. If you try to write off the cost of your den or your home security system, then you're over the line.

 

Only because we had a small business and always had and have a tax person do our taxes.
They go by percentages and it’s only that area of your home that you use for your business. That’s why it’s only certain percentages you claim against your electrical, etc. And you keep all receipts, from electricity, mileage, phone, etc. for 5 yrs. Not sure on the security but shoot, these days, I would think you could claim a percentage. Anyway, just my experience on it. Just document etc.

 

I err on the side of "do not claim". My time and peace of mind is worth a lot more to me now than the amount I'd potentially save on taxes.

 

[long time no duplicate post!]

 

Understandable. But we only claimed what was used etc. We pay for the peace of mind as well but I do know some people, let’s just say biting off more than they can chew. We had our permits etc.

 

So if you metal detect a valuable coin and sell it. Are you roped in for tax on the entire amount

 

Mike, just curious, how would the buyer be responsible for reporting a gain on a coin they just bought? They have no gain, or loss, until they sell.

 

another issue facing the bay and you thought it was hard making money before..LOL