Any ebay sellers here?

[11522914]

I was really curious about this comment so I finally checked ebay's fee schedule.

For most categories, the fee is 12.55% plus $0.30/item.
For books, movies, and music, the fee is 14.55%/$0.30 per item.
For sports and trading cards, the fee is 12.35% plus $0.30/item.

There are a couple of niche categories that have a fee less than 12.35% but the overwhelming majority of items fall in the 12.35 to 15% range plus the $0.30/item.

The fee does drop significantly on very expensive items. The portion of sales over $7,500 is only 2.35% (but the first $7,500 is still 12.55%).

Here is the full fee schedule:
https://www.ebay.com/help/selling/fees-credits-invoices/frais-pour-les-vendeurs-particuliers?id=4822

Maybe they have an eBay store where the fees are reduced.

 

[disneysteve]

Maybe they have an eBay store where the fees are reduced.

Ah, that could be. I don't know how ebay stores work.


I just knew something didn't makes sense about him saying he was paying 8-10% when my fees YTD are averaging 16.7%.

 

[11522914]

Ah, that could be. I don't know how ebay stores work.


I just knew something didn't makes sense about him saying he was paying 8-10% when my fees YTD are averaging 16.7%.

I don't know how much you sell but may be beneficial to open a store and pay for a month.

I used to sell years ago higher priced items. I would calculate what my fees were if I opened a store for one month and just listed everything for sale.

Saved quite a bit in fees.

Don't know if that option is still available so YMMV.

 

[disneysteve]

I thought I'd bump up this thread. I started it in January 2022 when I was just starting to ramp up my ebay selling as I prepared to cut back my working hours.

I ended up grossing nearly $14,000 in sales for 2022 which I was quite pleased with. Net profit was just over $10,000. Not a bad side gig at all and I really enjoy doing it.

When I started the thread, I had 50 items listed. I now have 300 and make sales nearly every day, sometimes multiple sales per day. I've also gradually focused on sourcing higher priced items. My highest sale was $610 with one for $499, one for $365, and numerous others over the $100 mark. That's great because it allows me to make the same or more with fewer transactions and less work. I still make plenty of $20 and $30 sales too as that keeps things moving but I try to find more better items when I'm out sourcing.

How is everyone else doing with ebay and other online sales platforms?

 

[CaptTom]

Thanks for circling back and filling us in on your progress!

Without re-reading the whole thing, did you ever mention how you're sourcing your merchandise?

We had a yard sale a few weeks ago. One guy was looking at everything, then stopping to look up items on his phone. We assumed he was checking to see what he could get for each item on eBay. He bought quite a few odd-ball items.

 

[disneysteve]

Thanks for circling back and filling us in on your progress!

Without re-reading the whole thing, did you ever mention how you're sourcing your merchandise?

We had a yard sale a few weeks ago. One guy was looking at everything, then stopping to look up items on his phone. We assumed he was checking to see what he could get for each item on eBay. He bought quite a few odd-ball items.

I source primarily from estate sales. I started checking them out in February 2022 and quickly learned that for the types of things I like to sell, they are a gold mine. I still do some yard sales and thrift shops but the vast majority of my stuff is from the estate sales. I also learned about a good freebie app (Freebie Alerts) and have gotten numerous things through that for resale. You can't beat free.


And yes, the guy at your yard sale looking things up was checking values. I try to avoid being super obvious when I do it at yard sales but I do it openly at estate sales where most of the customers are resellers like me.

 

[COcheesehead]

Last year we did $2500 ish which is little lower than our typical $3000- $5000 ish/ year in sales. So far this year we stand at $597 in sales. I plan to keep it there. The next sale triggers a 1099. I didn’t use to worry about things like that, but now I do.

 

[mebden]

I stopped selling completely but I do buy from it once I find a good deal. Like I said in my previous post when they had to start issuing tax forms I quit and fees are getting ridiculous

 

[disneysteve]

Last year we did $2500 ish which is little lower than our typical $3000- $5000 ish/ year in sales. So far this year we stand at $597 in sales. I plan to keep it there. The next sale triggers a 1099. I didn’t use to worry about things like that, but now I do.

You’d rather not make any more money than include a 1099 when you file your taxes? What sense does that make? You have to file anyway. What difference does it make if you have a 1099 or not?

 

[disneysteve]

I stopped selling completely but I do buy from it once I find a good deal. Like I said in my previous post when they had to start issuing tax forms I quit and fees are getting ridiculous

I don’t understand the tax form issue. I’ve been selling since 1986. I’ve been filing taxes since 1986. Last year was the first time I got a 1099. It made absolutely no difference except for having to include it with my return. Why would that keep anyone from selling?

 

[COcheesehead]

You’d rather not make any more money than include a 1099 when you file your taxes? What sense does that make? You have to file anyway. What difference does it make if you have a 1099 or not?

Think about that for a minute.

 

[disneysteve]

Think about that for a minute.

Think about what? You’d rather make $597 and fail to claim it than make $5,000 that you are forced to report? I get that people lie on their taxes but how do you come out ahead in this scenario? After paying taxes on 5K you’ll still have a lot more than $597.

By the way, does that $597 in sales include postage paid by the buyers because that’s part of what gets reported.

 

[COcheesehead]

Think about what? You’d rather make $597 and fail to claim it than make $5,000 that you are forced to report? I get that people lie on their taxes but how do you come out ahead in this scenario? After paying taxes on 5K you’ll still have a lot more than $597.

By the way, does that $597 in sales include postage paid by the buyers because that’s part of what gets reported.

There’s a better answer. I hesitated to even post because I expected such a reaction from you. I’ll leave the thread.

 

[disneysteve]

There’s a better answer.

Enlighten me.

 

[CaptTom]

You've got my curiosity, too.

Do tell!

 

[freedomatlast]

I got a surprise last week from ebay when I was charged a foreign transaction fee on a sale made to Puerto Rico. Apparently ebay doesn't recognize Puerto Rico for the US Territory that it is. And since ebay no longer accepts phone calls, there's no one to discuss it with. The chat bot is totally and completely useless. After digging down deep enough in their rules and regulations, it does show that Puerto Rico is considered foreign, but still doesn't make sense. They'll try anything to take a little bigger slice of your sales, I guess. Definitely not the same site it used to be.

 

[Trailwalker]

I'm going to guess at the "better answer." Could it be better to declare the income without a 1099 trigger and invite less IRS scrutiny?

 

[disneysteve]

I got a surprise last week from ebay when I was charged a foreign transaction fee on a sale made to Puerto Rico. Apparently ebay doesn't recognize Puerto Rico for the US Territory that it is. And since ebay no longer accepts phone calls, there's no one to discuss it with.

PR definitely isn't international. The foreign transaction fee is for currency conversion but that doesn't apply here.


Ebay does have phone support. However, the phone reps are frequently wrong so I don't recommend it. The preferred way to get help is through the ebay for business Facebook page.

 

[disneysteve]

I'm going to guess at the "better answer." Could it be better to declare the income without a 1099 trigger and invite less IRS scrutiny?

That makes no sense, though. Why intentionally limit your sales to under $600 if you're going to report it anyway (which most people don't which is exactly why they had to lower the limit from $20,000).

The huge advantage of reporting it is that you get to also claim your expenses. I can deduct postage, shipping supplies, mileage, breakage, and various other things to offset my income. You can even make a home office deduction. If you're paying your own health insurance, you can run that through the business. You can have a SEP IRA or individual 401k for the business. So many advantages to doing it properly.

The only good reason I can think of to not sell on ebay is if the income would push your AGI over a threshold for subsidies of some sort like ACA or Medicare, but then the $600 threshold wouldn't be the amount you were concerned with.

 

[disneysteve]

I made my 3rd largest sale ever this week. I bought a 16mm film reel on May 26 at an estate sale. Paid about $8. Did a little research and learned it was made by RCA and the US Air Force Reserve in 1961. Put it up for auction starting at $19.99. Got an offer the next day for $30 which I declined. Then the same guy offered me $150 which I also declined. Auction ended Thursday night for $477.77 (same guy who made the earlier offers). Profit after fees and shipping and all was just over $383. Not a bad return on an $8 investment in 2 weeks.

 

[11522914]

That makes no sense, though. Why intentionally limit your sales to under $600 if you're going to report it anyway (which most people don't which is exactly why they had to lower the limit from $20,000).

The huge advantage of reporting it is that you get to also claim your expenses. I can deduct postage, shipping supplies, mileage, breakage, and various other things to offset my income. You can even make a home office deduction. If you're paying your own health insurance, you can run that through the business. You can have a SEP IRA or individual 401k for the business. So many advantages to doing it properly.

The only good reason I can think of to not sell on ebay is if the income would push your AGI over a threshold for subsidies of some sort like ACA or Medicare, but then the $600 threshold wouldn't be the amount you were concerned with.

I have a question for you. I was doing what you're doing today back in the 2005-2006 timeframe. Bought a bunch of stuff at garage/estate sales and sold a lot of items. Got burned out on selling all that stuff and anything left over when up in my attic/closet to be sold at a future date.

Well that future date is now. So my goal is to sell all those items that were purchased back in 2005-06. Funny thing is a lot of these items are worth much more that back then.

So I've been selling all that stuff and keeping detailed records for tax time. But I have also been selling personal items too that no tax on should be paid because I'm selling them for far less that the original cost and have been keeping detailed records for that too.

Do you also sell personal items? How do you account for selling both personal and for business items in a single year? Do you pay any tax on your personal items? The goal is to liquidate all business items this year and going forward will only be selling personal items.

Any suggestions from anyone on how I should proceed with taxes this year? I'm already way over $600 this year on both personal and business sales.

 

[disneysteve]

Do you also sell personal items? How do you account for selling both personal and for business items in a single year? Do you pay any tax on your personal items?

Any suggestions from anyone on how I should proceed with taxes this year? I'm already way over $600 this year on both personal and business sales.

Whether an item you sell is "personal" or "business" really doesn't matter for taxes. All that matters is how much you sold it for vs. how much you paid for it. Of course, you don't have records of those personal purchases for things you bought 20+ years ago so you just have to use a good faith estimate.


Honestly, it's not unlike my business purchases. I mostly source from yard sales and estate sales. All cash payments. No receipts or electronic payment record. It's totally an honor system. I keep a log of what I buy and how much I pay.


When I sell personal items, I estimate what the item cost when we bought it. Since I've been reselling for nearly 40 years, I occasionally sell something I bought 20-30 years ago. I usually don't have purchase records for those things either, just like when you sell personal items.


For taxes, you file a Schedule C. That's where you report your sales and deduct your expenses. Just make sure what you report matches the 1099 you get to the penny.

 

[11522914]

Whether an item you sell is "personal" or "business" really doesn't matter for taxes. All that matters is how much you sold it for vs. how much you paid for it. Of course, you don't have records of those personal purchases for things you bought 20+ years ago so you just have to use a good faith estimate.


Honestly, it's not unlike my business purchases. I mostly source from yard sales and estate sales. All cash payments. No receipts or electronic payment record. It's totally an honor system. I keep a log of what I buy and how much I pay.


When I sell personal items, I estimate what the item cost when we bought it. Since I've been reselling for nearly 40 years, I occasionally sell something I bought 20-30 years ago. I usually don't have purchase records for those things either, just like when you sell personal items.


For taxes, you file a Schedule C. That's where you report your sales and deduct your expenses. Just make sure what you report matches the 1099 you get to the penny.

Thanks. Just want to make sure I understand.

So are you deducting expenses on your personal items too? Are you just documenting both personal & business items together with each corresponding expenses so that a loss on your personal item reduces your profit on the business items?

 

[disneysteve]

Thanks. Just want to make sure I understand.

So are you deducting expenses on your personal items too? Are you just documenting both personal & business items together with each corresponding expenses so that a loss on your personal item reduces your profit on the business items?

For tax purposes, a sale is a sale. The IRS doesn't care where you got the item or whether or not you personally used it before you sold it. I know a lot of resellers who buy things to resell and use them until they are sold. Is that "personal" or "business"? It doesn't matter.


I report my total sales for the year. I deduct my cost of goods for those items. I deduct all relevant expenses (postage, packing materials, equipment, mileage, ebay fees, etc.). I pay taxes on the net profit.


If I'm selling a "personal" item, I still have ebay fees, postage, and packing material costs associated with that sale and that all gets included in my deductions.

 

[11522914]

For tax purposes, a sale is a sale. The IRS doesn't care where you got the item or whether or not you personally used it before you sold it. I know a lot of resellers who buy things to resell and use them until they are sold. Is that "personal" or "business"? It doesn't matter.


I report my total sales for the year. I deduct my cost of goods for those items. I deduct all relevant expenses (postage, packing materials, equipment, mileage, ebay fees, etc.). I pay taxes on the net profit.


If I'm selling a "personal" item, I still have ebay fees, postage, and packing material costs associated with that sale and that all gets included in my deductions.

Thank you very much. This actually makes it much easier for me as I was tracking personal & business separately but was still tracking all expenses for both just in case.

I created a new separate Quicken file to track everything and I make sure the totals match ebay reports to the penny.

I have to admit it is much easier to sell on ebay and track everything versus back in 2005. They have really simplified the entire process.