New Tax Laws eBay PayPal & more

[Tin Can]

I sorta heard something about reporting sales? or cash of $600 and more automatically?

The little guy pays again

What is happening?

[maltfalc]

you're complaining that they're making it more difficult to cheat on your taxes? ok then.

[Tin Can]

I ask a ?

you accuse

by by

you're complaining that they're making it more difficult to cheat on your taxes? ok then.

[maltfalc]

I ask a ?

you accuse

by by

they're reporting taxable income to the people who keep track of your taxable income and collect taxes, specifically for the purpose of preventing people from hiding their taxable income and not paying their taxes. your complaint is "the little guy pays again". is there some other hidden meaning to that besides not wanting to pay your taxes?

[j.e.simmons]

How does ebay know its taxable income? They don’t, so they’ll report it. If I sell my Nikon that I bought in the mid-70s, how do I prove my basis?

[Jody_S]

I can't comment about the IRS in USA, but I do know how CRA works here in Canada. Our banks all report deposits to the CRA monthly, to the nearest dollar. EBay reports total sales, I don't know if it's monthly or yearly. CRA uses the $30K exemption from GST/HST as a threshold; once you go over that in yearly sales, they audit you and make you pay the sales tax you were supposed to collect, going back 3 years. So just make sure you never get close to the $30K yearly and you're considered a hobbyist. You can of course fight them on this by arguing you're selling your personal gear, but in order to fight it you may have to pay the entire amount they're asking first (why?), and they tend to just make up numbers and will try to bill you $100K+.

So there isn't much point in diversifying your sales platforms, your bank will still report total deposits from all sources. I used to leave my money in Paypal and use it for my LF purchases, since I actually am a hobbyist and that's how I finance my addiction. But with eBay's new payments system, all payments are automatically deposited in my bank account, then eBay takes money back out if I purchase postage from them. So they're maximizing my tax liability.

[maltfalc]

How does ebay know its taxable income? They don’t, so they’ll report it. If I sell my Nikon that I bought in the mid-70s, how do I prove my basis?

your basis for what? why would when you bought something make the money you sold it for tax-exempt?

[BrianShaw]

your basis for what? why would when you bought something make the money you sold it for tax-exempt?

https://www.irs.gov/forms-pubs/about...le-d-form-1040

[maltfalc]

I can't comment about the IRS in USA, but I do know how CRA works here in Canada. Our banks all report deposits to the CRA monthly, to the nearest dollar. EBay reports total sales, I don't know if it's monthly or yearly. CRA uses the $30K exemption from GST/HST as a threshold; once you go over that in yearly sales, they audit you and make you pay the sales tax you were supposed to collect, going back 3 years. So just make sure you never get close to the $30K yearly and you're considered a hobbyist. You can of course fight them on this by arguing you're selling your personal gear, but in order to fight it you may have to pay the entire amount they're asking first (why?), and they tend to just make up numbers and will try to bill you $100K+.

So there isn't much point in diversifying your sales platforms, your bank will still report total deposits from all sources. I used to leave my money in Paypal and use it for my LF purchases, since I actually am a hobbyist and that's how I finance my addiction. But with eBay's new payments system, all payments are automatically deposited in my bank account, then eBay takes money back out if I purchase postage from them. So they're maximizing my tax liability.

the only difference selling your personal gear makes is you can't claim what you originally paid for it against what you sold it for, otherwise everyone would be having garage sales just so they could claim an $800 loss on a cd player they bought in the 80s. selling your personal gear is still taxable income.

[j.e.simmons]

This is not sales tax. It is income tax. As a general rule, if you sell used goods - a camera for instance - for less than you paid for it, you don't owe income tax. Basis is the value of the thing at the time you acquired it. How do you prove your basis for old used goods? Most of it will not be taxable, but you will have to be able to prove it.