So, money orders.

[sndmn11]

Maybe if it was someone with no feedback doing the shipping to someone who was well established.

I personally don't think I would be ok with doing a transaction that way, just seems odd to me. You would be out the money and the item if it went south.

Then again with PayPal g&s you could be as well, not on here but some other sites I've heard of people being returned their "item" and it being a box with trash in it and PayPal taking the original buyers side because they have proof of return from the tracking label.

I heard of an instance where some bottled water was shipped to the buy instead of the item. In the grand scheme of things, a buyer is out protected by their financial institution by choice of method.

 

[Wvroach]

I heard of an instance where some bottled water was shipped to the buy instead of the item. In the grand scheme of things, a buyer is out protected by their financial institution by choice of method.

Yeah I remember that Hoboaron or something similar scammed that fella. That sucks for that guy. Never heard a follow up on it if he ended up getting his money back or not.

 

[fwafwow]

I could be wrong on the whole 1099/IRS part but won’t you only pay if you collect more than $600 and have made money? Maybe I’m the minority but I’m not usually making money on items I sell here…..so if I sell $600 worth via PayPal but those items cost me $1000 - I’m not paying additional taxes correct? I’m not doing the MO thing either and I’m really only going to buy and sell from well know sliders…..so if I miss out on a sale from a newbie - no big deal

Correct.

 

[fwafwow]

No, they (Paypal, Ebay, etc.) don't. Payment processers (like Paypal) are required to report if more than $20,000 AND 200 transactions are made in a year. In which case you will be sent a 1099-K. Otherwise, nothing is reported.

I think this is the old rule. https://www.paypal.com/us/smarthelp...e-irs-will-i-receive-a-tax-form-1099-k-faq729

 

[fwafwow]

Paypal, Ebay, etc reports to the IRS you made 600$ regardless what you bought it for.


Elections have consequences!

The reporting doesn’t mean the receipts are income though.

Fwiw, I am not personally worried about using G&S and getting a 1099-k. But I’m hearing more problems with PP in general, including for sellers. So while I will agree to G&S I would much rather prefer to go another route with a trusted member.

 

[Rob5589]

I've used usps money orders for both buying and selling many times. I always cash them at the po before shipping. One issue is, the po may not have the cash available depending on amount and there is a monetary limit on a usps mo.

 

[tdhanses]

I think this is the old rule. https://www.paypal.com/us/smarthelp...e-irs-will-i-receive-a-tax-form-1099-k-faq729

It is, starting in 2022 it’s been dropped to $600 per year for companies like paypal. I’ll probably just stop selling stuff and not deal with the bs.

If I do sell i’ll go the personal check route and 10 day waiting period for it to clear before shipping.

 

[Marbles]

I think this is the old rule. https://www.paypal.com/us/smarthelp...e-irs-will-i-receive-a-tax-form-1099-k-faq729

You are correct. I will edit my post.

 

[fwafwow]

You are correct. I will edit my post.

No worries. This topic is a source of mass confusion on quite a few forums.

 

[Zappaman]

I think the unanswered question is what effect a PERSONAL seller will experience come next year when we all have to do our taxes. A 1099K (or other 1099x) forms have usually mean "income" and so I wonder if PERSONAL sellers (Vs. biz sellers) will be held to producing (or having kept) records of the item's previous "cost" (which if bought in 1975 is doing to be kinda hard to do).

Not the same as a BUSINESS selling here... I can ASSURE you they WILL have to have those "cost" records (and possibly depreciated value records- "residual value") for EACH item. If I had a biz here, I'd RUN it as a biz and expect the tax hit from the income (BUT... I'd ALSO have more write-offs to use against it compared to a private seller). As a biz, you are selling "inventory" and so you have to play by the rules (now... maybe).

I do not know for personal seller though, but I DO know a personal check is as good as a money order-- with time to clear (because my rural post office NEVER has cash! -haha!). So the few items I sell here will be offered with a personal check option with that time to "clear my bank" clearly stated. Otherwise, given my tax rate for a year (20% effectively last year anyway), is what I MIGHT have to eat IF this thing goes the wrong way- as it might. So... a $1000 gun nets $800 (maybe) taking Paypal-- nobody KNOWS yet and that is my frustration.

I think the key is to buy from trusted sellers (and be one). I'm not "buying and selling" to make a buck, but just to finance other projects with ones I no longer have an interest in. So I'm FINE with a seller holding my check 2-3 weeks and keeping the transaction PRIVATE. I KNOW I'll not get dinged by Uncle Sam doing it this way and the key here is be patient and willing to wait. LIke christmas presents under the tree-- you have to wait, BUT they are appreciated when you finally open them

Edit: there used to be a "hobby" designation for income under a certain point... I wonder if that might play for we "private" sellers???

Where are our accountants (with "gratuitous agency" leanings)?

 

[fwafwow]

If you buy something for $600 and sell it for $1000, you have $400 of income. It doesn’t matter if it is a hobby, personal or a business, or the method of payment (PP, check, MO, cash or a trade).

 

[Zappaman]

If you buy something for $600 and sell it for $1000, you have $400 of income. It doesn’t matter if it is a hobby, personal or a business, or the method of payment (PP, check, MO, cash or a trade).

That is 100% true... but I'd say it does matter IF one has to pay (or not) pay taxes on it.

If I sell my neighbor an old trailer for $300 I (like most) don't declare it because the law says I do not have to if the transaction is private (and I doubt many even think to remember to claim stuff like this come tax season).

If Fortune 100s get away without paying taxes... it's because they know the laws (they help craft BTW). I'm not going to pay taxes I don't have to either... by law. And that is my question here.

 

[fwafwow]

If I sell my neighbor an old trailer for $300 I (like most) don't declare it because the law says I do not have to if the transaction is private (and I doubt many even think to remember to claim stuff like this come tax season).

I agree that plenty of people probably don’t report things that are income. But there is no private transaction exception, for trailers to neighbors or gear to a Rokslider.

 

[Marbles]

I think the unanswered question is what effect a PERSONAL seller will experience come next year when we all have to do our taxes. A 1099K (or other 1099x) forms have usually mean "income" and so I wonder if PERSONAL sellers (Vs. biz sellers) will be held to producing (or having kept) records of the item's previous "cost" (which if bought in 1975 is doing to be kinda hard to do).

Not the same as a BUSINESS selling here... I can ASSURE you they WILL have to have those "cost" records (and possibly depreciated value records- "residual value") for EACH item. If I had a biz here, I'd RUN it as a biz and expect the tax hit from the income (BUT... I'd ALSO have more write-offs to use against it compared to a private seller). As a biz, you are selling "inventory" and so you have to play by the rules (now... maybe).

I do not know for personal seller though, but I DO know a personal check is as good as a money order-- with time to clear (because my rural post office NEVER has cash! -haha!). So the few items I sell here will be offered with a personal check option with that time to "clear my bank" clearly stated. Otherwise, given my tax rate for a year (20% effectively last year anyway), is what I MIGHT have to eat IF this thing goes the wrong way- as it might. So... a $1000 gun nets $800 (maybe) taking Paypal-- nobody KNOWS yet and that is my frustration.

I think the key is to buy from trusted sellers (and be one). I'm not "buying and selling" to make a buck, but just to finance other projects with ones I no longer have an interest in. So I'm FINE with a seller holding my check 2-3 weeks and keeping the transaction PRIVATE. I KNOW I'll not get dinged by Uncle Sam doing it this way and the key here is be patient and willing to wait. LIke christmas presents under the tree-- you have to wait, BUT they are appreciated when you finally open them

Edit: there used to be a "hobby" designation for income under a certain point... I wonder if that might play for we "private" sellers???

Where are our accountants (with "gratuitous agency" leanings)?

Hobby designation is pretty worthless. Since 2018 you cannot deduct hobby expenses, but must report all income. For example, say my wife makes $1,000 selling art and we spend $3,000 on supplies and equipment. If that is filed as hobby income I just have to pay taxes on the $1K (added on to at the top bracket). Now, if we file as business income, I get to write $2K off in losses. Before 2018, for hobbies you could write off the amount of expenses, so in the above scenario while I could not write off the $2K in losses, I at least would not pay tax on the $1K.

To make it worse, if you file as a business and have losses 3 years in a row, the IRS is likely to audit you and ask for proof that you have a business and not a hobby.

Now, if it was collectables, than it is counted as capital gains and one can claim capital losses (or pay what is normally a lower capital gains rate). I think all my hunting gear has just turned into a "collection" that I buy and sell from to perfect said "collection." I mean, the IRS considers "any alcohol" a collectable. (Note, this is being a smartass, I'm not sure this would be a good idea).

 

[Marbles]

I agree that plenty of people probably don’t report things that are income. But there is no private transaction exception, for trailers to neighbors or gear to a Rokslider.

I wonder if a trailer would be considered a capital asset (like a vehicle) by the IRS. In which case as long as you lose money you don't have to report it (because the IRS will not let you claim a capital loss). Of course, if you make money on it, they require you to report it. https://www.cargurus.com/Cars/articles/how_do_taxes_work_on_private_car_sales

I bet they would not consider a GPS/Binos/Etc as capital assets, so they would probably feel you need to report the whole amount as income like a hobby... Never mind, looks like I was being too pessimistic https://www.findlaw.com/tax/federal-taxes/do-you-need-to-report-your-online-sales-to-the-irs.html

Anyway, I'm not an accountant, so my opinions are subject to being wildly wrong.

 

[Zappaman]

Thank you Marbles... I wasn't sure on the "hobbie" status as of late. And just another reason for me to keep transactions as "private" as I can.

I have an LLC and understand the three year loss "problem", but I hate to mingle my personal assets with the biz assets. And until THIS year, nobody cared... and so ends the years of tax free buying and selling on Ebay, etc. probably.

I guess I might have to "claim" our wine cellar now - wait!!! -if we drink it, maybe I can take a "loss"!

 

[fwafwow]

Hobby designation is pretty worthless. Since 2018 you cannot deduct hobby expenses, but must report all income. For example, say my wife makes $1,000 selling art and we spend $3,000 on supplies and equipment. If that is filed as hobby income I just have to pay taxes on the $1K (added on to at the top bracket). Now, if we file as business income, I get to write $2K off in losses. Before 2018, for hobbies you could write off the amount of expenses, so in the above scenario while I could not write off the $2K in losses, I at least would not pay tax on the $1K.

To make it worse, if you file as a business and have losses 3 years in a row, the IRS is likely to audit you and ask for proof that you have a business and not a hobby.

Now, if it was collectables, than it is counted as capital gains and one can claim capital losses (or pay what is normally a lower capital gains rate). I think all my hunting gear has just turned into a "collection" that I buy and sell from to perfect said "collection." I mean, the IRS considers "any alcohol" a collectable. (Note, this is being a smartass, I'm not sure this would be a good idea).

So glad we are talking about taxes and not Covid!

Hobby expenses were never that good, as they were treated as miscellaneous itemized deductions - not like cost of goods in a business. That’s why people went to great lengths to prove they were raising horses (or whatever) as a business instead of a hobby. You are right about the change in 2018.

I don’t know the definition of a collectible but they are taxed at capital gains rates, but at a higher rate (28%).

 

[Zappaman]

I bet they would not consider a GPS/Binos/Etc as capital assets, so they would probably feel you need to report the whole amount as income like a hobby... Never mind, looks like I was being too pessimistic https://www.findlaw.com/tax/federal-taxes/do-you-need-to-report-your-online-sales-to-the-irs.html

I just read this and I here's what caught my attention:

"Online sales of personal, used items do not generally have to be reported. Selling your old bicycle on Craigslist is an example of these types of sales. Losses on personal-use property are not deductible on online sellers' tax returns. The rule of thumb is that if you used the items and then sold them for less than you bought them for, then you owe no taxes on the sale."

So, it would seem to me (based on the above ***which may or may not be current law given the new "reporting" requirements from Ebay, etc)... that if you aren't regularly buying and selling (for profit), items you USED yourself for a time, then decided to sell off for a "used price"... that there is no tax.

The question is: who determines if you are "making" a profit on used items (non-collectable)? I mean, everyone selling reloading stuff here (lately) is PROBABLY selling it for more then they paid. But if they don't do it for a living... who's the wiser to say what they paid for it (what the cost basis is)?

And IF you sold say 20 different things a year (here or Ebay or Craigslist-- whatever), and its personal property (without a "cost" basis on any books), HOW can the IRS know if you are making money or (probably losing it...) - and why would they care? After-all... it's your word against "nobodies" and so I'm just wondering if the NEW reporting requirements will be put under some "total amount" umbrella which $600 would seem kinda LOW (*ESPECIALLY when we can't claim personal LOSSES any more).

Finally, if I get a 1099K because I sold off an old bicycle (that cost $1200 in 2007) for $601... how's that going to "play" into my 2022 taxes? From what I read above- it doesn't. But if eBAy now says I sold over $600, how would I prove it was at a loss (without finding the receipt from 2007?)

Again... I can find nothing to speak to this.

 

[fwafwow]

I just read this and I here's what caught my attention:

"Online sales of personal, used items do not generally have to be reported. Selling your old bicycle on Craigslist is an example of these types of sales. Losses on personal-use property are not deductible on online sellers' tax returns. The rule of thumb is that if you used the items and then sold them for less than you bought them for, then you owe no taxes on the sale."

IMHO the article is poorly written. The first sentence should have been written as follows "Online sales of personal, used items do not generally have to be reported because most people sell items for less than what they paid." Instead the author included extra language that leads one to believe that the conclusions have something to do with items being personal, or used. Another example for the last sentence - if you sold something for less than you paid, you don't owe taxes - it has nothing to do with whether you used the item or not.

So, it would seem to me (based on the above ***which may or may not be current law given the new "reporting" requirements from Ebay, etc)... that if you aren't regularly buying and selling (for profit), items you USED yourself for a time, then decided to sell off for a "used price"... that there is no tax.

Whether you used the item does not matter. Your statement is correct only if the "used price" is less than what you paid for it. It doesn't matter if you are buying or selling on a regular basis or not.

The question is: who determines if you are "making" a profit on used items (non-collectable)? I mean, everyone selling reloading stuff here (lately) is PROBABLY selling it for more then they paid. But if they don't do it for a living... who's the wiser to say what they paid for it (what the cost basis is)?

The general rule is if you have basis in an item, you have to prove it.

And IF you sold say 20 different things a year (here or Ebay or Craigslist-- whatever), and its personal property (without a "cost" basis on any books), HOW can the IRS know if you are making money or (probably losing it...) - and why would they care? After-all... it's your word against "nobodies" and so I'm just wondering if the NEW reporting requirements will be put under some "total amount" umbrella which $600 would seem kinda LOW (*ESPECIALLY when we can't claim personal LOSSES any more).

I think this is the reason for the concern over the new reporting rule. If you are issued a 1099-K, you are now on the IRS radar. If you don't report your income (if any) associated with that 1099, then you are at risk of later audit, at which time you will have to prove your basis.

Finally, if I get a 1099K because I sold off an old bicycle (that cost $1200 in 2007) for $601... how's that going to "play" into my 2022 taxes? From what I read above- it doesn't. But if eBAy now says I sold over $600, how would I prove it was at a loss (without finding the receipt from 2007?)

Again... I can find nothing to speak to this.

You have to prove your basis.

I'm not defending the law, just trying to state what it is. What is "income" is extremely broad - if you find money on the street, technically that's income and you are supposed to self-report it on your income tax return. Do people ever do that? I doubt it.

 

[hunt1up]

Although I prefer digital payment I will accept a USPS money order if the buyer asks to use one. It slows down the process a little but I've never had a problem. I just take the MO to my banks(one a regional bank, one a credit union) and they'll cash it in 5 minutes. Once I get cash in hand I'll go ship the item. It isn't too difficult.