ebay & taxes
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Oklacarcollecto
Life is an experiment
There is supposedly a "trigger" dollar amount that gets the information sent to the IRS.
805moparkid
Slant and AFX Guy
well i know they are starting a system where if you buy or sell over a certain number i think it was 7500, then you get a 1099 in the mail, and have to enter your Tax ID pin into ebay...
my step dad does alot of deals on ebay for antique and collectable bicycles...
EDIT: this is yearly not per transaction BTW...
my step dad does alot of deals on ebay for antique and collectable bicycles...
EDIT: this is yearly not per transaction BTW...
Oklacarcollecto
Life is an experiment
PayPal/IRS Reporting Requirements start 2011?
May 18, 2010 11:46 PM
Most of you may be aware of this, but I wanted to post the info. to update the group. This is from a PayPal official. Get Ready - 2011 is around the corner.
"Hi, I'm Ken Swab, senior federal government relations officer at PayPal. You might have heard that Congress recently passed the Housing and Economic Recovery Act of 2008, a major housing bill that the President signed into law on July 30. The bill contains a provision impacting PayPal and our merchant customers, so I wanted to explain the requirements and what they mean for some of you.
Under the legislation, PayPal will be required to report to the IRS the total payment volume received by PayPal customers in the U.S. who:
receive more than $20,000 in payment volume in a single year; and
receive more than 200 payments in a single year.
This legislation applies to all payment providers including PayPal and takes effect in 2011, so the first reports will go to the IRS in January 2012. Our goal when the legislation takes effect is to make it easy for PayPal merchants who fall under the provision to report their taxable incomes.
I want to emphasize that this new law affects a small percentage of PayPal customers. Early versions of the legislation would have required PayPal to report total payment volume of many more customers, including those who received as little as $600 per year. We worked hard to educate Congress about the unique features of PayPal and the unique nature of our customer base. We also educated lawmakers about the many PayPal customers who receive money from others for reasons not related to operating a business.
It was important that this legislation didn't burden entrepreneurs with new tax compliance demands or inappropriately raise reporting requirements on those who are not merchants.
With help from many of you, we conveyed these views to congressional leaders. And as a result of that dialogue, the legislation doesn't overreach or negatively impact individual Internet users, the growth of small businesses, or the entrepreneurial spirit that makes the Internet so powerful.
Thank you, to the many PayPal and eBay customers who took the time to write to your U.S. Senators about this legislation. Your voices encouraged Congress to reject the initial overly-burdensome proposal and to limit the impact of the final version of this bill.
UPDATE (8/18/08 ): Thanks for all of your great questions! I have been responding to as many of them as I can. However, because the legislation has just recently been passed and we do not know exactly how the IRS will implement the requirements, we do not yet know the answers to some of the questions that have been posed. Rest assured that as more details about the requirements of this law become available, will provide updates as necessary.
In response to some of the questions below about business expenses (such as shipping, insurance, etc.), it is very important to point out that the figure PayPal will report to the IRS is only the total payment volume received by your business. Because of business expenses and other reasons, this figure may not match the yearly revenue or income figures that you report to the IRS in your tax forms. We encourage all of you to consult with your tax advisor when this law takes effect to ensure that you are complying with federal tax laws."
http://groups.ebay.com/topic/Numism...s/Paypalirs-Reporting-Requirements/1501138954
May 18, 2010 11:46 PM
Most of you may be aware of this, but I wanted to post the info. to update the group. This is from a PayPal official. Get Ready - 2011 is around the corner.
"Hi, I'm Ken Swab, senior federal government relations officer at PayPal. You might have heard that Congress recently passed the Housing and Economic Recovery Act of 2008, a major housing bill that the President signed into law on July 30. The bill contains a provision impacting PayPal and our merchant customers, so I wanted to explain the requirements and what they mean for some of you.
Under the legislation, PayPal will be required to report to the IRS the total payment volume received by PayPal customers in the U.S. who:
receive more than $20,000 in payment volume in a single year; and
receive more than 200 payments in a single year.
This legislation applies to all payment providers including PayPal and takes effect in 2011, so the first reports will go to the IRS in January 2012. Our goal when the legislation takes effect is to make it easy for PayPal merchants who fall under the provision to report their taxable incomes.
I want to emphasize that this new law affects a small percentage of PayPal customers. Early versions of the legislation would have required PayPal to report total payment volume of many more customers, including those who received as little as $600 per year. We worked hard to educate Congress about the unique features of PayPal and the unique nature of our customer base. We also educated lawmakers about the many PayPal customers who receive money from others for reasons not related to operating a business.
It was important that this legislation didn't burden entrepreneurs with new tax compliance demands or inappropriately raise reporting requirements on those who are not merchants.
With help from many of you, we conveyed these views to congressional leaders. And as a result of that dialogue, the legislation doesn't overreach or negatively impact individual Internet users, the growth of small businesses, or the entrepreneurial spirit that makes the Internet so powerful.
Thank you, to the many PayPal and eBay customers who took the time to write to your U.S. Senators about this legislation. Your voices encouraged Congress to reject the initial overly-burdensome proposal and to limit the impact of the final version of this bill.
UPDATE (8/18/08 ): Thanks for all of your great questions! I have been responding to as many of them as I can. However, because the legislation has just recently been passed and we do not know exactly how the IRS will implement the requirements, we do not yet know the answers to some of the questions that have been posed. Rest assured that as more details about the requirements of this law become available, will provide updates as necessary.
In response to some of the questions below about business expenses (such as shipping, insurance, etc.), it is very important to point out that the figure PayPal will report to the IRS is only the total payment volume received by your business. Because of business expenses and other reasons, this figure may not match the yearly revenue or income figures that you report to the IRS in your tax forms. We encourage all of you to consult with your tax advisor when this law takes effect to ensure that you are complying with federal tax laws."
http://groups.ebay.com/topic/Numism...s/Paypalirs-Reporting-Requirements/1501138954
terzmo
Well-Known Member
The "States" are trying to collect taxes off internet sales
Oklacarcollecto
Life is an experiment
He was asking about the seller paying taxes. You are correct that the states are looking at the lost sales tax revenues also. This is also true for places that have county and city sales tax.
Frankie
Member #9641
This is interesting... I don't know the particulars about this, but...
It would seem to me if the buyer pays, it would be a sales tax, if the seller pays, it would be an income tax. Two different rates. I don't know of any state that has a slaes tax higher than it's income tax (if it has both taxes).
Depending on who is doing the taxing, an income tax could be levied by both the state (the seller lives in) and the Feds.
Oklacarcollecto
Life is an experiment
That is correct. Here we have state, city and county sales tax so there are three enities that want the sales tax.
In Oklahoma you will pay income tax on it if it is on your federal return because you fill the numbers off the federal return to fill out the state return.
Frankie
Member #9641
Geez! It's only a matter of time before they meter our toilets!
not sure.. but myebay says i can sell 750 items or 15000 per month. i think ebay is forgetting the cost of goods sold.. the stuff i sell on ebay.. i pay for.. its not junk that i inherited or stole.. I paid for it.. hmmm this is gonna be interesting. plus the states trying to collect $$ for internet sales.. I know in pa, that the pa govt spend millions on a study to find out that they could r*pe consumers more and more.. and more for uncollected sales tax..
Oklacarcollecto
Life is an experiment
LOL, they do already have those meters for people with wells that use city sewer.
Sewer Meter Program
http://www.marionutilities.com/site/wwpt/smp
One way or another. One thing is for sure.
The government is going to keep finding more ways to tax us...
The government is going to keep finding more ways to tax us...
Oklacarcollecto
Life is an experiment
Direct from the IRS website. http://www.irs.gov/businesses/article/0,,id=254258,00.html
Payment Card and Third Party Network Payment FAQs
Q. What is merchant payment card and third party network reporting?
A. We now require, under section 6050W of the Internal Revenue Code, that payment settlement entities (such as payment processors and third party settlement organizations) report merchant payment card (e.g., VISA, MasterCard or American Express) and third party network transactions (e.g., PayPal or Google Wallet). This reporting requirement begins in early 2012 for payment card and third party network transactions that occurred in 2011.
Q. What is Form 1099-K?
A. The payment settlement entity responsible for reporting merchant payment card and third party network transactions will report gross transaction amounts on the new Form 1099-K, Merchant Card and Third Party Payments. We require reporting of the gross amount of reportable transactions for the calendar year and its corresponding months. The reporting of both annual and monthly amounts is necessary in order to reconcile differences between information returns and tax returns of fiscal year filers.
Q. If I use a merchant payment card or a third party settlement organizations to make a personal purchase, do merchant payment card reporting rules affect me and will I receive a Form 1099-K?
A. No, these provisions affect only those businesses or entities that accept merchant payment cards or third party network transactions in payment for goods or services. Individuals will not receive a Form 1099-K for making a purchase.
Q. I own a small business and also have a not-for-profit hobby. I do not accept merchant payment cards for payment for either, but I do use a credit card and third party settlement organization to make purchases for both. Do the merchant card payment card reporting rules affect me?
A. No, the provisions for payment settlement entity reporting affect only those businesses or entities that accept these forms of payment for goods or services. Therefore, you will not receive a Form 1099-K when making a purchase.
Q. I sell items on e-Bay and accept merchant payments cards for payments. How do the payment settlement entity reporting rules affect me?
A. You will receive a Form 1099-K for the gross amount of proceeds for the goods or services purchased from you through use of a merchant payment card in a calendar year. Further, if you are set up to accept payments using a third party settlement organization and the total number of your transactions exceeds 200 AND the aggregate value exceeds $20,000 in a calendar year, you will receive a Form 1099-K from the third party settlement organization.
Q. If I have a holiday craft business and accept merchant payment cards for payments, how do the payment settlement entity reporting rules affect me?
A. If you are set up to accept merchant payment cards as a form of payment, you will receive a Form 1099-K for the gross amount of the proceeds for the goods or services purchased form you through the use of merchant payment card in a calendar year. Further, if you are set up to accept payments from a third party settlement organization and the total number of your transactions exceeds 200 AND the aggregate value exceeds $20,000 in a calendar year, you will receive a Form 1099-K from the third party settlement organization.
Page Last Reviewed or Updated: February 14, 2012
Payment Card and Third Party Network Payment FAQs
Q. What is merchant payment card and third party network reporting?
A. We now require, under section 6050W of the Internal Revenue Code, that payment settlement entities (such as payment processors and third party settlement organizations) report merchant payment card (e.g., VISA, MasterCard or American Express) and third party network transactions (e.g., PayPal or Google Wallet). This reporting requirement begins in early 2012 for payment card and third party network transactions that occurred in 2011.
Q. What is Form 1099-K?
A. The payment settlement entity responsible for reporting merchant payment card and third party network transactions will report gross transaction amounts on the new Form 1099-K, Merchant Card and Third Party Payments. We require reporting of the gross amount of reportable transactions for the calendar year and its corresponding months. The reporting of both annual and monthly amounts is necessary in order to reconcile differences between information returns and tax returns of fiscal year filers.
Q. If I use a merchant payment card or a third party settlement organizations to make a personal purchase, do merchant payment card reporting rules affect me and will I receive a Form 1099-K?
A. No, these provisions affect only those businesses or entities that accept merchant payment cards or third party network transactions in payment for goods or services. Individuals will not receive a Form 1099-K for making a purchase.
Q. I own a small business and also have a not-for-profit hobby. I do not accept merchant payment cards for payment for either, but I do use a credit card and third party settlement organization to make purchases for both. Do the merchant card payment card reporting rules affect me?
A. No, the provisions for payment settlement entity reporting affect only those businesses or entities that accept these forms of payment for goods or services. Therefore, you will not receive a Form 1099-K when making a purchase.
Q. I sell items on e-Bay and accept merchant payments cards for payments. How do the payment settlement entity reporting rules affect me?
A. You will receive a Form 1099-K for the gross amount of proceeds for the goods or services purchased from you through use of a merchant payment card in a calendar year. Further, if you are set up to accept payments using a third party settlement organization and the total number of your transactions exceeds 200 AND the aggregate value exceeds $20,000 in a calendar year, you will receive a Form 1099-K from the third party settlement organization.
Q. If I have a holiday craft business and accept merchant payment cards for payments, how do the payment settlement entity reporting rules affect me?
A. If you are set up to accept merchant payment cards as a form of payment, you will receive a Form 1099-K for the gross amount of the proceeds for the goods or services purchased form you through the use of merchant payment card in a calendar year. Further, if you are set up to accept payments from a third party settlement organization and the total number of your transactions exceeds 200 AND the aggregate value exceeds $20,000 in a calendar year, you will receive a Form 1099-K from the third party settlement organization.
Page Last Reviewed or Updated: February 14, 2012
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