Fight over IRS Form 1099K Threshold to Resume

by: GetAGrip

Come on folks. Man up, quit whine and pay your taxes. Quit being a dead beat.

by: iheartjacksparrow

If you sell online, you need to report your profits and pay your taxes, just like every other business. I don't see how people who sell their Swifty tickets on eBay can be "shocked" that their sales were reported since eBay charges tax on every transaction.

by: Old School Seller

It's not like eBay needs to dedicate a battalion of employees to hand-figure the numbers for each seller and then stuff envelopes with 1099-k forms when, in fact, computers handle it all instantly with the touch of a key and machines stuff the envelopes. It's time for ALL online sellers to follow the law and pay the piper.

by: MilesT

This may get more controversial if eBay starts issuing 1099K's to non-US citizens (especially where these are non-resident in US).

And I wonder if this would turn into "tit for tat" with EU enforcing GDPR (data privacy) on sellers trading out of the US (especially those who run their own websites as well).  Fines up to 4% of turnover for non-compliance with GDPR rules (likely only that level if truly egregious, and finding a natural or corporate person to sue in an EU jurisdiction could be a challenge)

by: Andy

> This may get more controversial if eBay starts
> issuing 1099K's to non-US citizens (especially
> where these are non-resident in US).

Non-US citizens are subject to paying taxes like everyone else if they reside here. Ask me how I know. ;-) I get 1099s from eBay and other places, same as you 'murricans.

by: my2cents

It is likely that the many of those getting a 1099K at the $600 level, would have zero of very little impact to their income taxes owed.  Some may not even be required by IRS rules to even file a return at certain income levels and other personal info.

Part of what this is about for some people is the affect it may have on their Federal or State benefits.  I've read articles where there are many people concerned about this.  

Its the subject of taxes and the IRS that I think scares the heck out of most people.  The reality of this is it just isn't likely to have much of an impact on those getting the form for the lower end of dollars.

Then there are those that earned a good chunk of change off Ebay or other sites and never reported their income if it fell below the $20,000 threshold.  Some may be surprised at finding out how many were actually not reporting their income if it was $19,999 or below.

I remember years ago having a conversation with an Ebay seller that had never reported her income if it fell under then threshold.  I'm not sure whatever happened to her, but she likely ended up with a more than a few problems with IRS.

by: trader_chris

Here's the issue I have. I maintain two eBay accounts - one for business and one for personal use. My business account has all of the payments flow through my business account and I pay taxes monthly / annually accordingly. I don't have an issue with that.

What I do have an issue with is being taxed multiple times to buy / sell the same item. I pay for things using funds that have already been taxed as personal income. Then I pay state sales tax on the item. Now the government wants to charge me AGAIN for selling that same item (at a reduced price) when I want to upgrade or get something different. Three different taxes on the same item is overreach, period.  

by: cvsharkey

Question:  Are the Feds going to prosecute those out of country sellers who don't pay the taxes?

Question: Are the Feds EVER going to tax the 400? (Nope.)  

by: CBW

Anyone wondering why sales have been slow? This is one of the reasons why. Sellers that don't want to deal with this are now selling more offline, in person, cheaper and for cash.  

by: my2cents

@trader_chris

If you are buying things for resale on Ebay or anywhere else, you should not be paying sales tax on those items.  But you do first need to file the appropriate paperwork with your state to get a Resale Certificate.

by: Whatever

if the uber rich would pay their same fair share this wouldn't be an issue

by: comments

It is a little funny that the anti capitalist generation of tax the rich and make everyone pay their fair share is so upset about actually having their income reported to the IRS forcing them to pay tax on the profit.

Perhaps now we can all agree on fiscal responsibility, lower taxes, a fair tax system is badly needed.

The whole country still forgets that everyone who earns more than the poverty line is going to see tax increases as soon as the Trump tax cuts expire in 2025.

No matter where your political ideology lies it seems clear that the current administration has no interest in extending them and is still reporting the fake news talking point that this only affects the rich. For political purposes the "rich" seems to be anyone earning over $22,001 yr. Although every American will see their standard deduction slashed by about 50% and those making less than $160,000 in business income will lose their qualified business income tax deduction (QBI) and still have to cover the costs of inflation, product cost, and selling fees. Translation - If you think things are bad now, a blood bath awaits.

by: comments

Also

The inflation reduction act included included funding for 87,000 new IRS workers specifically to go after these "swifties" and those like them.

The Biden Administrations signature bill "American Rescue Plan" that authorized the reporting requirements to drop from from $15,000 to $600 would have been unenforceable without the 87,000 new IRS workers in the Inflation Reduction Act.

This is info not being accurately reported by either main political party. Don't believe TV or political pundits. Do your own research and tell all your friends.

I understand why the author doesn't want to be political, but I think it is very important for everyone to understand how this happened and who did it to us. Ultimately, facts and not spin are how these problems get fixed.

In the case of the Inflation reduction act. This was passed through a backdoor promise to Joe Manchin (D-WV) who agreed to sign the bill in exchange for energy production (the the Biden Administration later reneged so he got nothing for this).

Those who gratefully cashed their $1200 checks from the Biden "American Rescue Plan" were actually getting screwed by existing text in the same bill that caused the drop to the $600 reporting requirement.

Biden isn't all bad though. He provided incontrovertible evidence that trickle down economics works beautifully. The money he flooded the markets with were a big win for small business. My sales were never better, not ever. It would be very hard not to notice that business was absolutely booming until they money ran out and the interest rates got jacked up..

by: Stone Cutter

*** I can’t wait for Trump tax cuts to end ***

@ Comments

You say….
“The whole country still forgets that everyone who earns more than the poverty line is going to see tax increases as soon as the Trump tax cuts expire in 2025.”

You are incorrect. Those living in higher wage States with high taxes got hit with SALT taxes. Since the Trump tax cuts, I have to pay taxes on my State taxes (which are typically deductible from my income).

SALT taxes were mostly felt in States on the West Coast and North East, which are traditionally “blue” States, and well devised by Steve Mnuchin to be that way. I pay more in taxes under the Trump tax cuts.

I can’t wait for the Trump tax cuts to end.  

by: Shanna

@Stone Cutter

" I have to pay taxes on my State taxes (which are typically deductible from my income). "

This is false. You don't live in a higher wage state, you live in a higher tax state. Those of us living in lower tax states were subsidizing your lifestyle for decades, now you have to pay your fair share. Don't like how much you are paying, vote in new politicians that will lower your taxes.

by: Stone Cutter

*** Trickle down or trickle up? ***

@comments

You say….
“Biden isn't all bad though. He provided incontrovertible evidence that trickle down economics works beautifully. The money he flooded the markets with were a big win for small business.”

During Covid, business owners were saying that it was those stimulus checks that created the boom. When millions of Americans received extra cash in their bank accounts, it was that stimulus money that kept businesses afloat. Even companies like Etsy said they made great profits because of the stimulus checks that were sent out to consumers.

There was no “trickle down” here, but rather, “trickle up”.  

by: Stone Cutter

@Shanna

You say…
“This is false. You don't live in a higher wage state, you live in a higher tax state. “

But I need a high wage to support living on the West Coast. Real estate is very expensive.

My cost of living is higher on the West Coast. I can’t help that. And math doesn’t lie. It’s always been the West Coast and North East who have paid more to the Federal government.

It’s up to the “States” to provide to their citizens with better paying jobs. If you’re poor, you need to ask your State representatives why that is. Why should I subsidize you when you have poor State leadership?

Because of good paying jobs, property values are high on the West Coast as many want to live here. Even with current high interest rates, real estate sales are still hot.

Two homes in my neighborhood just sold for $1.3 mill and $2.2 mill. It’s those high wage earners who already pay their fair share in federal taxes. My neighborhood is not wealthy. We just pay more for everything because there is so much demand for people who want to live here because of the healthy job market.

Also, the higher the income, the higher the Federal tax bracket. When making more than $180k, the Federal Government takes another big chunk.  

by: Rexford

This:

{if the uber rich would pay their same fair share this wouldn't be an issue}

But this: {trickle down economics works beautifully}  What a bunch of bunk.  The 1% have proven over and over that they don't trickle down anything.  That is the nature of greed.

If the poor and middle class are paid a decent wage they are the ones who will do the trickling.

by: comments

If the poor and middle class were paid more then most would probably just work less hours.

Regardless of how the 1% get their money, they have to spend it to make more. The more free capital the more they invest. Lower taxes, child tax credits, and stimulus both had this effect as well. It was still tax revenue going to the hand of the 1%. More money in and more money spend fueled the need for job growth. People had more money in their pockets to spend and so they spent it. Thus the trickle down effect. Trickle down economics is more money reaching the hands of the lower classes and them spending it to fuel the economy. No one except like apple has more many than the government. Trickle down from them or say Google...its the same thing.

If the poor and middle class were paid more then inflation would just move the poverty line elsewhere. This is something you see every time you go to the store.

Lots of hate but not lots of facts. The SALT deduction cap of $10,000 IS the rich paying their fair share LOL!! If you make Bernie's "Fifteen bucks an hour" you aren't going to need to deduct more than $10K in SALT taxes. I 100% understand why everyone and anyone would be pissed about that. That isn't a federal issue though. Look at the states that don't have state and local taxes.....why should their taxes pay for your unions and the regulations they put regulations that are not imposed at the federal level? In TX you can set rent a porta potty for a few bucks a month. A one stall toilet they are building in CA costs over a million dollars. All permitting and requirements that you can just avoid by moving elsewhere.

by: HappyOne

Who does Ebay think they are kidding. Only thing Ebay is worried about is spending money on postage to mail out all those new 1099K. Now every time I sign into my Ebay account I have to X out that I do not want to go “PAPER LESS”. Onetime X out should all that is required. Ebay is hoping I make a mistake or finally give up.