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Thread: Income taxes on Ebay?

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    Strawberry (Level 2)
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    Default Income taxes on Ebay?

    I having been selling on ebay for a few months now and im really pleased with everything. The thing is, I don't want to get slapped with some income taxes or whatever come 'that time.' Im almost positive that they don't have this, but I just want to be sure?

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    Pear (Level 6) rpepper9's Avatar
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    I have been selling for four years straight now, at about 5000.00 each year. Never claimed anything, never been asked. I think that it falls under "other income" which you can claim, if you want. I think that you don't have to claim untill it reaches a certian amount any way. Maybe someone with tax background can clarify that point for you.
    Condoleezza Rice is nice, but I prefer A Roni!

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    Kirby (Level 13) Griking's Avatar
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    I don't think the IRS actively persues income tax evaders on eBay currently but I wouldn't be surprised if they started soon as it gets to be more and more popular. I doubt that they're just ignoring the fact that eBay makes millions per year off a few percent of each transaction.

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    Kirby (Level 13) Buyatari's Avatar
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    When the govt wants to know what you search for on goggle how far behind can this be? It will happen. When I dunno. Ebay will hand over the sellers numbers and you'll be getting a nice little form letter for the past 7 years worth of items sold.

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    Bell (Level 8)
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    People with businesses have to file their Costs - Receipts = Profits with the IRS. Same with Ebay businesses.


    The money I make's only $25 a year--- don't need to report that small amount.
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    Kirby (Level 13) Griking's Avatar
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    Quote Originally Posted by kevin_psx
    People with businesses have to file their Costs - Receipts = Profits with the IRS. Same with Ebay businesses.


    The money I make's only $25 a year--- don't need to report that small amount.
    So for all the transaction problems and bad selling experiences on eBay that you tell us about here you only make $25 a year. Yeah, ok.

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    Bell (Level 8)
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    Yes--why surprised?

    COST new games - EBAY SALE used == just over $25 profit in 2004.
    .

    () - "Darkness cannot drive out darkness; only light can do that.
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    Pretzel (Level 4) johno590's Avatar
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    Quote Originally Posted by kevin_psx
    Yes--why surprised?

    COST new games - EBAY SALE used == just over $25 profit in 2004.
    I'm very surprised... You must be getting ripped off or something.

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    Bell (Level 8)
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    jeez--



    Sold Final Fantasy 10-used for $15.50
    I Paid $15
    And so Net profit = $0.50.
    --> Multiply by some 50 games sold in 2004 = just over $25 total income.

    I oversimplified. Some games lost money. Some games doubled the price I paid--- but you get the point. My net Ebay profit on Ebay is small.

    Understand?
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    () - "Darkness cannot drive out darkness; only light can do that.
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    Pretzel (Level 4) philosophyst's Avatar
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    So, all the bitching and moaning you subject us to was the result of making $25 a year? You are such a tool Kevin.

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    Apple (Level 5) Nate Nanjo's Avatar
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    Quote Originally Posted by kevin_psx
    Sold Final Fantasy 10-used for $15.50
    I Paid $15
    And so Net profit = $0.50.
    --> Multiply by some 50 games sold in 2004 = just over $25 total income.
    So you didn't sell anything in 2005?

    I hope this is stuff from your collection and not something you buy just to make a small profit...

    Also by that method, does it include fees or not? If not, then you would actually make less than $25 :P

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    Kirby (Level 13) Buyatari's Avatar
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    Yes--why surprised?

    COST new games - EBAY SALE used == just over $25 profit in 2004
    Yeah well you won't get to subtract what you paid for those unless you do report it as a business. Most people sell stuff for a loss at gargage sales and flee markets but its not a loss unless its a business and reported as a business as the items were purchased for personal use if you don't own a business.

    Wait for an audit and you just try to tell them you only really made $25.00 after they call you on it. Better start saving the reciepts for all those games which you bought at face value. And you better report your costs and expenses every year. If you aren't set up as a business then its personal use and you are screwed. Sell $5,000.00 worth of items a year don't be suprized when they expect you to pay taxes on ALL $5,000.00 times how many years you sold for plus penalties plus interest. They may not let you declare any expenses. IRS is no joke. They may never ever call you on it but if they do your story won't help one bit.

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    Strawberry (Level 2)
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    I report all of my income from eBay. It take a lot of time plus it is considered self employment income so I have to pay the self employment taxes.

    I know that there are several sellers of games on eBay who do not report their income. These people are crazy. They will be sharing a cell with Richard Hatch. Have fun!

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    Insert Coin (Level 0)
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    I report every month threw my store my online sales and Ebay sales. Then I have cost of goods sold and operating cost and then I get my profit. My profit is very very little once my accountants get done with everything and some months is a little loss but it all works out, also everything I buy is for resale :P but when I keep my few rare things its added to my inventory on hand.
    The IRS is no joke and for the most part they are correct unless you can prove them wrong and then they tax you for a settlement number or take every refund you might get for the next 10 years to repay them.
    I have bought 2 businesses that had tax problems just to save the owners butt and then turned the company aound and sold them
    If you are ever in St louis stop by my store Trade-N-Games. I have a huge selection of vintage games along with the new systems. Or shop online now www.tradengames.com
    Jason

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    Cherry (Level 1)
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    Is Richard Hatch in jail?!?! I am a huge battlestar fan!

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    Pretzel (Level 4) ozyr's Avatar
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    I haven't sold anything on ebay in a few year, but when I did, i reported everything on my taxes. It's the law, as it is income. For those who don't post this money, just hope you don't get audited!!!

    that's my two bits....

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    Cherry (Level 1)
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    Sorry, I just googled it and that's a different Richard Hatch.

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    Here's a general rule I think applies

    Did you make enough to fix up your car in a calender year? maybe some new tires, new stereo..... You're probably alright not claiming it

    Did you make enough to buy yourself a brand new car? even a really good used one? .... then you probably should claim it

    As far as I know, the IRS just doesn't have time right now to track down every person making less than a hundred dollars a month on Ebay. Especially this year, they are swamped with problems with scandals, the Hurricanes, etc etc. But if you are actually making a good bit of money and don't claim any other income for years, at some point a red flag will raise, eventually it will catch up to you if you don't claim it.

    Keep in mind that Richard Hatch didn't pay taxes on ONE MILLION DOLLARS, he would probably owe about 40 percent, which is 400,000 dollars, and thats not to mention other thousands of dollars he didnt claim in appearances, even a charity donation in his name went missing. And on top of that, it took them years to get this guy, he won Survivor in what, 2000???

    That's not to say that Ebay won't give in at some point and just send all their info right to the government. I'm sure it will happen at some point, thats why this year I'm going to keep track of everything and do it right

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    Bell (Level 8)
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    Quote Originally Posted by Nate Nanjo
    2004 = just over $25 total income. I oversimplified. Some games lost money. Some games doubled the price I paid--- but you get the point. My net Ebay profit on Ebay is small.
    So you didn't sell anything in 2005? I hope this is stuff from your collection and not something you buy just to make a small profit...
    Have not calculated 2005's profit yet. Estimate around 150. Fees are subtracted off the price before I calculate. ---> Yeah it's my "excess stuff" I'm selling. Stuff I played & don't want no more. My goal's not to run a business--- just get rid of old stuff.


    I haven't sold anything on ebay in a few year, but when I did, i reported everything on my taxes. It's the law, as it is income
    Income = Sale Price - Cost of Purchase - Fees & Expenses = very small amount. Many lose money so it's negative income & does not need reported.
    Wait for an audit and you just try to tell them you only really made $25.00 after they call you on it.
    no prob. I've got receipts showing expenditures to buy games. Ebay Sale - Expenditures = Only $25 in 2004 . The IRS has nothing to collect.




    Being scammed out of money by dishonest buyers & sellers is worth bitching about. It may only be $50 but it's still not right.

    Maybe I should let scammers go free w/o filing complaints? It would be less stressful.
    .

    () - "Darkness cannot drive out darkness; only light can do that.
    Hate cannot drive out hate; only love can do that." - Martin Luther King, Jr.

    "Manners are a sensitive awareness of the feelings of others. If you have that awareness, you have good manners, no matter what fork you use." - Emily Post ----- Component Video looks just as good as RGB, is a heck of a lot easier to set up, and also a lot cheaper!

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    Kirby (Level 13) Buyatari's Avatar
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    no prob. I've got receipts showing expenditures to buy games. Ebay Sale - Expenditures = Only $25 in 2004 . The IRS has nothing to collect.
    You can look at it anyway you want. I'm just telling you that the IRS IF they for some reason deciede to look at you will not take this as an answer and there will be another thread here about how you got screwed over. This time it will be the IRS and not a customer. Why don't you call them and ask if its ok not to declare profit and loss because they equal out.

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