Warning: Check Your Accounts for IRS Form 1099K

by: Lightning

So after the uninformed CA sellers reported that eBay erroneously issued the 2021 1099-k even though they didn't reach $20k, it turns out eBay was correct in doing that according to CA law.

EBay did something right - that IS news! Stop the presses!

by: GovyGirl

Checked my account and sure enough, I had a 1099K sitting in there reporting $3000.00.

by: 3TimesALady

It's not just eBay that is messed up.  Etsy is screwed up, too.  My accounts are on the other end of the spectrum wherein neither site issued a 1099-K, although I am in NJ who has a $1,000 reporting threshold. I had to call both venues.

The eBay CSR (who was in Colombia, South America!) wrote up a ticket.  The Etsy CSR rep said Etsy was aware of the issues, they were working on it, and expected the 1099's to be available by the end of the day (that was February 1).

As of this morning, both sites are still indicating that I am not eligible for a 1099-K.

Some companies have no business managing payments.  It doesn't get more clear than this.

by: 4yourinfo

@3TimesALady
You don't need a 1099k to report your income - I wonder if an out of state company can be forced to issue a 1099k?  

by: 3TimesALady

Yes, I understand that.  The point is that both Etsy and eBay (and the others are legally obligated to provide that information.  They have not done so.

These sites want to be in our business and in our faces for every little thing, and yet they cannot even comply with the laws of this country.  Go figure.

by: Rexford

Happy to have it.  I've been working on my taxes and this will ensure that the amount that I report is the amount that eBay shows and has reported to IRS.

Today I actually thank eBay for something.

by: terry55

It happen to my friend, got a 1099K for 2020 and 2021 from ebay but did not meet the requirements but this was for Missouri. They generated a 1099 for me 1st week of Jan. that say's Aug 2021 1099. Ebay's has their system all messed up, pretty sure they added the new $600 requirement, shot gun the system and fix the glitch afterward, just a regular thing for ebay.

by: Small Potatoes

Can anyone tell me where to check in my account to see if I have a 1099?

by: steveylang

Go to your Seller Hub, click on Payments tab, then on the left side there will be a link for 'Taxes'. I'm in CA and got one.

by: Uhg

I live in CA and sold way under $20,000 and received a 1099-K today to my surprise.  I want to REMIND other sellers that many seller's sales are NOT taxable, if you sell used HOUSEHOLD items below the price you purchased it, it is NOT taxable or reportable prior to 1/1/2022 ALSO if you sold INHERITED items and sold them for under their FMV than they are also NOT taxable or reportable prior to 1/1/2022, these items are ONLY reportable IF they were sold for a profit OVER purchase price or FMV.  I am a senior citizen and I was fully aware that starting 1/1/2022 that if these type of sales exceed $600 they would NOW be reportable but still NOT taxable.... a seller as of 2022 would have to begin keeping track of the items and their original purchase price or FMV in order to NOT be taxed in 2022 (which is an extreme hassle for the mom selling old kids toys for less than she purchased them just to make ends meet and also a huge hassle for seniors who inherited items that they rightfully can sell withOUT being taxed as long as they don't sell for more than inherited FMV just so a senior citizen can also make ends meet.  BUT what has taken these sellers for surprise is receiving a 1099k for 2021 in CA when we were told it would NOT be sent if we didn't exceed $20,000.  So now the housewife/mom and senior citizens have to go back through EACH transaction in 2021 and list them in a spreadsheet to show the items were sold for under original purchase price or under FMV of inherited items.  There was NO WARNING that this would happen to CA sellers for 2021, we were told it would start in 2022! WHY was a 1099k sent to CA sellers for 2021?, this was suppose to start in 2022.  When commenting please get your facts straight that these items STILL won't be taxable just now have to PROVE it in a detailed spreadsheet.  UHG!

by: Small Potatoes

Thank you, steveylang--I found mine. I really wish ebay would put a note in Messages to alert the seller that the 1099 was ready and waiting there, especially since many people in CA probably weren't expecting one until next year.

To Uhg: How are you figuring out FMV of inherited items? I have a ton of depression glass, etc. that I inherited more than a decade ago that I'd like to sell now, and I am at a loss for figuring out FMV from that long ago.

by: Snapped

“ I have a ton of depression glass, etc. that I inherited more than a decade ago that I'd like to sell now, and I am at a loss for figuring out FMV from that long ago.”

Challenge, and grueling perhaps, but not insurmountable.  

Quick Google search on ‘depression glass price history’ returns this entry on the first page:

“ May 20, 2012 — Antique Depression Glass ( Part-1) Chart. Name, Description, Size, Price. Adam, Bowl, Dessert, Pink,, 4.75 ...

Source
antiques-prices.com was first indexed by Google more than 10 years ago
·
https://www.antiques-prices.com/antique-depression-glass-
part-1-price-guide-760. “

Using the first example provided (say you sold one of these Pink Adam Desert Bowls) shows what one can presume to be a FMV of $4.75 in 2012 for that item.  But that was a decade ago….

A bit of cipherin’ for inflation and that 4.75 turns out to be worth about $5.50 today.

And that would be reasonable FMV deduction for cost basis.  

That’s just one quick drop in the ocean example of course, and for a reasonably ‘common’ type inheritance item of collectible value.  But that’s the general approach.

The same ‘inflation’ adjustment can be made for purchased items from decades ago as well.  

by: Old School Seller

Yes, eBay did NOT send sellers a personal message this year that 1099-k's were ready which was something PayPal ALWAYS did!  Trust me, there are millions of sellers out there who are totally clueless, especially those who handle their sales 100% on their phone using the worthless mobile app.  This information should also be prominently posted as a banner on everyone's Seller Hub page for a few weeks.   Spoke to a successful seller yesterday who is a senior citizen and he had never even heard of a 1099-k!

by: MIscetal

I used the same PayPal account for transfers from friends and family, and as a way to route payments I didn't want to disclose my banking information for.

How can PayPal tell what I received money for? My wastrel brother's five year late repayment of a loan was received by PayPal, along with dinnerware I sold.

by: terry55

My question is why ebay is sending out 1099's for 2020, if Missouri passed it in 2021??

by: Small Potatoes

Thank you, Snapped! That's a big help--I have 80 big boxes to go through!

by: postbuster

The worst part about ebay's sudden 1099K is that it would have taken them a lot of time to generate all of them.  
A plan that was well under works and someone had to approve them.
But they still wouldn't inform the sellers.

Just says more about the disrespect they have for their moneymakers.

by: postbuster

And what do sellers do when they get these problems dropped in their laps?

INR Claim with non payment or Return:
https://community.ebay.com/t5/Selling/Seller-protection/td-
p/32674229

Sales Tax Glitch:
https://community.ebay.com/t5/Buying/Ridiculous-Sales-Tax/t
d-p/32673572

With other companies, I have a little more faith in them correcting issues or even Their own mistakes.
But unfortunately its the big commerce platforms...

by: Lightning

@Uhg
''I want to REMIND other sellers that many seller's sales are NOT taxable, if you sell used HOUSEHOLD items below the price you purchased it, it is NOT taxable or reportable prior to 1/1/2022 ALSO if you sold INHERITED items and sold them for under their FMV than they are also NOT taxable or reportable prior to 1/1/2022, these items are ONLY reportable IF they were sold for a profit OVER purchase price or FMV.''

I don't know why you think this to be true.  I'd be interested in seeing where these rules or ''guidance'' are documented.

Everything you sell is *report-able*.  It's income.  Whether or not it is taxable depends on a lot of things - how you acquired it, what you paid for it, when you acquired it, what expenses you can attribute to the sale, etc.  Whether or not you get a 1099-K depends on your state's rules.

Your own state of California, on the web page referenced in the original article above, is indicating that anything over $600 will generate a 1099-K after Jan. 1 2021.  Maybe you have just not been keeping up with changes.

by: Tokimemofan

Just received this email from eBay:

A recent technical issue resulted in a 1099-K form being incorrectly provided to you. Please disregard the incorrect 1099-K form. The incorrect 1099-K form was not sent to the IRS or California Franchise Tax Board.

We’re working to resolve the issue and ensure that it will not happen again. Unless you had more than $20,000 in gross sales and 200 transactions in 2021, we will not submit a 1099-K form to the IRS or the California Franchise Tax Board.

We sincerely apologize for the error and any inconvenience this may have caused.

As always, thanks for selling on eBay, and for being part of the eBay community.

The eBay Selling Team