The IRS & ebay

[Moemg]

I've been selling on ebay & amazon and while I'm not a powerseller I'm making several thousand dollars doing it . At what point do you think the IRS will come after ebay sellers .

[VaCollector]

....as soon as they see this post

[ziggy29]

There's increasing talk that high-volume and high-ticket sellers will have to furnish their tax information and that these venues will be required to furnish sales information to the IRS.

Just keep good records and declare your profits on your tax returns and you'll be fine.

[ladelfina]

I always wondered about that kind of income.. that, and yard sales. Wouldn't most of the stuff be selling at a net loss? Like, I dunno.. Salad Shooter bought for $19.95 and you sell it for $2. If you treated it like a real business you should be able to write off the portion of your abode used for storing junk as being "warehousing costs" or something!

If you are selling something for less than you paid for it, it would be hard for me to see how the IRS could effectively call that "income". Your state, OTOH, might be interested in sales taxes. Here in Italy public yard sales or "car boot" sales are forbidden, because of the sales tax collection issue. You can place ads and sell stuff one-on-one; the tax people don't seem to care about that because it is not 'public'.

Of course if you are buying stuff cheap with the express purpose of selling it on Ebay for more, then I'd think you'd treat it like any other business.. but you should be able to set it up such that you can deduct your expenses as well: computer, packing materials, commissions, auto expenses if you roam the yard sales, etc.

[TN_INVEST]

Quote:

Originally Posted by ladelfina I always wondered about that kind of income.. that, and yard sales. Wouldn't most of the stuff be selling at a net loss? Like, I dunno.. Salad Shooter bought for $19.95 and you sell it for $2. If you treated it like a real business you should be able to write off the portion of your abode used for storing junk as being "warehousing costs" or something!

My thoughts exactly.
The average Joe isn't making money on Ebay when they sell stuff (just the same with a garage sale).

[wheel9]

Why not just go legit, report income, but shelter it in an IRA or Roth. Just use the business to launder taxable income into tax free retirement savings.

Eventually Amazon and Ebay will be required to report sales to the IRS. It is just too big to ignore forever.

[Moemg]

A lot of good points . I'm going to start keeping much better records . I just started doing it occasionally but it has evolved to a very profitable hobby .

[mews]

My understanding [not a tax maven] is that cleaning out your own stuff is one thing.

Buying stuff to sell, or selling stuff on consignment, is a business, once you are past very minimal levels. Report it - else the IRS will not be amused when/if they notice it.

ta,
mew

[audreyh1]

We sold a lot of stuff on ebay, but it was always our used stuff and never sold for more than what we originally paid (although occasionally it came pretty darn close!! - nice!)

But one time my husband did sell his old Rolex, and it sold for way more than what he paid for it in the 70s. We declared the gain on our tax return - it was taxed as a "collectible". Here's definitely a case where the capital gains are mostly due to inflation!

Audrey