PayPal & eBay income tax information

[woodbutcher]

I’m sure everyone here has seen the statements made about getting taxed on your PayPal and eBay sales,etc.. I talked to our personal accountant for the business and asked him about declaring my PayPal and eBay sales.. He said that the government has waved those fees and inquiries,unless you have $22,000 in transactions on PayPal,or eBay sales it don’t apply anymore,he said the changes were made at the beginning of the year before tax season started..... Hopes this helps anyone who was worried about accepting PayPal for machines they’re selling.

 

[sprchng]

That was for tax year 2022. I don't think it has been delayed in 2023 and they will nail you for having to justify any balance that totals over the $600 this year. Unless you are already filing the appropriate forms and running a business be prepared or use friends & family or USPS money orders.

 

[woodbutcher]

The way I was told from the accountant is it's permanent but I will ask him again and get a clear answer in case I misunderstood. But I don't think I misunderstood

 

[sprchng]

I think they deferred it because the Inflation Reduction Act which it is part of was passed in the first quarter of last year and made the $600 a retro active thing for many who had already exceeded that amount and it was deemed to be unfair at that point. However , I never heard anything about it not going into effect this year for your 2023 taxes.

What you need to know about next year's $600 reporting rule from the IRS

The new "$600 rule" involves payments received through third-party transaction networks like Venmo and PayPal.

www.cnbc.com

 

[david bull]

So that detector that I bought last year for $900 and sold this year for $850 is considered taxable income…If only I could get a couple million taxfree from communist China…

 

[tvr]

So that detector that I bought last year for $900 and sold this year for $850 is considered taxable income…If only I could get a couple million taxfree from communist China…

You need to keep records to show it was sold at a loss. It becomes a big issue for people doing garage sales and have no records of what things were bought for. Record keeping is going to be key. I've started recording when I find gold and silver and what the spot price is on the day found so that I can declare a basis on what it was worth when found. That way any capital gains when sold are based on anything over the basis point and not on the entire sale price I get. Without records, they can come after you for the entire amount of all sales.
I'm wondering how the IRS is going to attempt to go after barter; seems that is the next step.

 

[sprchng]

You are going to have to prove you lost money on anything you generate a paper trail on or you will get taxed on it. However , the part everyone overlooks is the sales tax. As soon as you report a sale , even if you have a loss , the State you live in may pick up the sale and make you pay the sales tax on it regardless. If I sold a detector for $850 and was losing money there would be no income tax but I would owe almost $75 in sale tax that I never collected. They are now arming and training IRS agents for "field work".

tvr,,,,,,,your cost basis has nothing to do with spot on the day you found it but what it cost you the day you acquired it. Better calculate your time and equipment and have records to back all of that up but , better yet , don't generate a trail they can follow and report nothing.

 

[david bull]

I guess it makes sense to do away with goods&services where your sale is protected and go to a format where you just send money to strangers with no recourse.Sort of fits in with everything else that is happening in Washington these days….

 

[Ronstar]

Maybe just pay the taxes with a bucket load of roached Zincolns. What are they going say??? Its not legal tender?

 

[sprchng]

I guess it makes sense to do away with goods&services where your sale is protected and go to a format where you just send money to strangers with no recourse.Sort of fits in with everything else that is happening in Washington these days….

Take the time to make the buyer a friend. Talk on the phone or at least have a little bit of online conversation to know you're dealing with a real person who has a certain level of honesty still left in their system. If you're the seller , your risk is that the buyer says it never arrives and you have no way to chase them down except insurance from the shipper. If a person doesn't have any history with a forum , which is where most of these sales originate , the seller and buyer are both nuts if they don't do a little "leg work" first. I also give a buyer the option of using USPS money orders as well.