eBay Sales on Form 1099k - Reporting requirements

anglinomics

All-Star
753
5.00 star(s)
I received the form because I had sales of around $1,100. One card sold for $500. In doing my taxes the free file program says I should report it on Schedule C (which is income for a business. I didn't get that far as the free file doesn't handle the schedule C. But I suspect that it will also ask me to pay social security tax on the amount. Of course my expenses well exceed what I got from sales, but I haven't documented those. I also checked on hobby income and I think if I reported it that way, it wouldn't be taxable.

Does anyone have any information on how your ebay sales were reported. I'm asking the small collectors who don't sell much. I'm presuming if you have an ebay store that it is business income to you. How did those small sellers report it, without violating your privacy? Did you pay any taxes from self employment or FICA?
 

cjay101

All-Star
625
5.00 star(s)
Staff member
you’ll have to report it but if you have proper documentation on expenses you can declare it as a hobby and offset the income. I know blowout cards has a giant thread in forums about taxes. It always branches back to talking to a tax professional.
Anything on schedule c that isn’t offset will have ssi/fica/med to pay (double employee rates)
 

GotMelky

MVP
1,507
5.00 star(s)
Technically I think for federal taxes you have to report if you made $20,000 or had 200 transactions in a year. You're supposed to report even if you don't hit those thresholds and receive one as well. Each state has different amounts as well.

Not hard to deal with the income - there are a bunch of allowed deductions as long as you have proof (purchase records, receipts, etc.) of them. You can count the cost of the original purchase (single or box) against the amount - shipping costs, supplies, inventory, etc.

It's annoying to have to go through the hoops with this but most collectors end up net negative (I usually stop at that point) when they deduct expenses.
 

anglinomics

All-Star
753
5.00 star(s)
I don't have any receipts, unless there is some way to find old transactions that I have bought on eBay. I don't think they have a query tool which would list your transactions based on a set on variables. I have paypal records but paypal doesn't show what is bought with eBay.

I'll pay the taxes, I am looking for a way to report it without the whole process of filling out a business return. And self employment income is subject to social security taxes. At one point in time, you didn't have to pay FICA if you made less than $600. But now, it says all income up to the maximum cap.

I found an article that's a few years old. But I'm banking on this statement. "If the activity is a hobby, you will report the income on Schedule 1, line 8 of Form 1040. The income won’t be subject to self-employment tax."

 
Top