I have an eBay account that I haven't used in years. I have some items that would be easier to sell for a good price online rather than locally. Wider audience willing to pay more for collectible stuff.

Logged onto eBay to list some items and they asked for my SSN and a bank account. Stopped there and am off to do some further research....

I was wondering if this has to do with the change in reporting requirements regarding annual sales (no matter how many transactions) of $600 or more must be reported to the IRS. The limits used to be over $20K with some minimum number of transactions.

I poked around a bit and it seems eBay started asking for this info a while ago, so maybe it's unique to them.
Not sure if I'm going to bump up against the same problem with other online sites.

I have a sneaking suspicion this is the new normal....

Is anybody selling on the eBay competitors like Etsy and Amazon? Got any suggestions for other places to sell besides the usual local pickup suspects like Craigslist, OfferUp, etc?

I use Craigslist and Facebook marketplace but neither is very effective.

Mostly I haul stuff to thrift stores.

Yeah, the IRS and the State of Illinois would like to think that anything you sell online is 100% profit. Buy a coat for $500 and sell it for $50, well that's $50 of income. AND no one does a good job of saying how to do a workaround as I discovered last year. If I were to sell my art or music collections, the it would be best for me to treat them as a business rather than possessions as that way losses can offset income. I've almost felt it best to treat one's whole life as a business, a big money losing business.

There are a bunch of sites for selling - but if you're getting paid via Paypal - then the IRS has a record of your "income."

Even FB seems to be attempting to track your "income" via Marketplace - unless you sell locally and refuse to answer whether sold or to whom.

quote:

Originally posted by kluurs:
it would be best for me to treat them as a business rather than possessions as that way losses can offset income. I've almost felt it best to treat one's whole life as a business, a big money losing business.

That’s very true. The tax code is written to favor businesses.

May as well take advantage of that.

Oooh I would be very uncomfortable putting my SSN into eBay.

Ugh. Brave new world indeed.

quote:

Originally posted by kluurs:
Yeah, the IRS and the State of Illinois would like to think that anything you sell online is 100% profit. Buy a coat for $500 and sell it for $50, well that's $50 of income. AND no one does a good job of saying how to do a workaround as I discovered last year. If I were to sell my art or music collections, the it would be best for me to treat them as a business rather than possessions as that way losses can offset income. I've almost felt it best to treat one's whole life as a business, a big money losing business.

There are a bunch of sites for selling - but if you're getting paid via Paypal - then the IRS has a record of your "income."

Even FB seems to be attempting to track your "income" via Marketplace - unless you sell locally and refuse to answer whether sold or to whom.

I've seen this explanation in multiple places; this one's from TurboTax:

quote:

Not every eBay sale is subject to income tax, but most are. If you use the site to get rid of household articles you've used in the past, you may qualify for "occasional garage or yard sale" treatment. According to the IRS, if your online auction sales are the Internet equivalent of an occasional garage or yard sale, you generally do not have to report income from those sales.

Assuming that you originally bought the used items for more money than you are selling them for, you don't have to report the income received from the eBay sale. For example, if you sell a bicycle that you paid $500 for two years ago for $350 on eBay, you usually don't have to notify the IRS—but you can't claim a loss on it.

And more detailed discussion about the new reporting requirements:

https://money.com/tax-1099-k-600-ebay-etsy/

I fall into the "garage sale" category, so I wouldn't owe taxes anyway. Your situation is more a hobby or business...

Not comfortable with giving eBay my SSN, so won't be selling there. Have also heard a lot of horror stories about eBay favoring buyers and routinely leaving sellers holding the bag. Not worth the hassle...

Interestingly, Zelle isn't reporting transactions to the IRS...

quote:

In a statement to NBC News, Early Warning Services, LLC, the network operator of Zelle, said, "If payments received on the Zelle Network are taxable, it is the consumer or organization's responsibility to report them to the IRS."

"The law requiring the issuance of forms 1099K applies to third party payment networks that handle the settlement of funds. Payments between friends and family, and eligible small businesses sent through the Zelle Network are not subject to this law because Zelle facilitates messaging between financial institutions, but does not hold accounts or handle settlement of funds."

https://www.nbcnews.com/news/v...ctions-irs-rcna11260

Zelle's FAQ:

https://www.zellepay.com/faq/d...-money-i-receive-irs

I sell PDF patterns via several internet sites, and get paid through PayPal. They definitely have my SSN; they’re like a bank.

I don’t sell tangible goods or do yard sales, though.

Zelle is good when one can use it. Ebay and Paypal both do report to the IRS - and generate the 1099K. On the tax form, it asks for one to record one's 1099K- and here's the good part, at least in previous years the IRS doesn't present a clear place to offset that 1099K or explain that whole garage sale strategy. The other thing is that if one sells a high end camera, expensive bicycle, fur coat - or some such, one easily clears $600. In 2020, I had a 1099K for over $3,000, Doug did come up with a suggestion for how to deal with it - here.

kluurs - Thanks for the link back to that previous discussion; I had forgotten about it. Very helpful.

I've been reading that eBay is a nightmare for sellers. Tales of unscrupulous buyers getting away with fraud because eBay is disproportionately siding with them, even when the seller has proof that someone is trying to pull a scam. I don't know how common the problem is.

Where are you selling? And what kinds of issues, if any, have you run into?

The whole selling/buying world has become a lot more messy. Many Ebay sellers report that Ebay sides with buyers - even when it seems clear that the buyer is scamming Still, I've not had a bad experience there. OTOH, I've slowed on using Ebay - using FB more - and just donating more as well. I'm more interested in the getting rid of - than recovering potential revenue.

Right now, I'm selling bicycles, camera equipment, laserdiscs, stereo equipment, artwork and some household items.

quote:

Originally posted by kluurs:
I'm more interested in the getting rid of - than recovering potential revenue.

Yup.

I just boxed up a ton of CDs and discovered that my library isn't taking donations right now; they're maxxed out. Guess everyone has been doing pandemic decluttering.

I found out about this organization in Addison. I talked to one of the founders and it sounds like a neat place.

https://www.scarce.org/

We have a bunch of stuff that they can reuse or recycle. We're heading over there soon.

I sell my self-published books through a variety of platforms. Amazon distributes my ebooks to their own platform, and Smashwords does it for libraries and retailers who aren't Amazon. Findaway Voices distributes my stuff everywhere that fine audiobooks are sold or borrowed.

They all have my SS#. I've always figured that this was part of doing business. They provide tax reporting forms, which makes preparing the taxes on my tiny self-publishing empire straightforward.

I was startled by kluurs' point about the IRS wanting to tax all of the income, but then I realized that this doesn't apply to the book biz. All three of those distributors take their cut for handling the ebooks' and audiobooks' electrons before any money comes to me, so the money I get is all taxable. Amazon produces the physical books that they distribute for me so, again, the cost of goods sold has already been deducted before the money comes to me.

There are big problems with how some aspects of Amazon's distribution policies work, but I've never had reason to question the tax setup.

That makes tons of sense.

I'm not in the business of selling in order to make money. Like so many people I joined eBay a couple of decades ago in order to sell stuff I didn't need anymore, the garage sale category in terms of tax consequences.

I haven't done any selling on eBay for a long time and there have been quite a few changes in how things work. The SSN requirement was unexpected, so that's why I stopped to investigate. Along the way I also read stories about how some buyers are scamming sellers, and it seems like some of the protections for sellers are gone.

I'm not sure what I'm going to do from here.