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Just submit a schedule C to IRS. Income as reported on 1099. Then add cost of goods sold, might be 90% of income, shipping costs, might be 30% of income, you have an offset against regular income. I believe you have to show profit in 2 years out of 5? IRS is not going to audit you unless you claim outrageous home office expenses.
I won a P320XC at a Sig Event. They sent me a 1099 for the full retail price.
I have won guns from S&W and Ruger and neither of them sent me any 1099s.
What's the practical advice on how to handle these 1099s though when going through TurboTax (for example)? Do you add the 1099 and pay the taxes? Ignore it? Sorry - I'm a moron when it comes to taxes, and plenty of other stuff now that I'm thinking about it.
Scroll up. I already commented the proper reporting procedure.
However, if you do NOT have a business and have card transactions greater than $600 you report the income on your return and a corresponding credit for "casual transactions not for profit".
What about selling unused personal Bruins tickets through Ticketmaster to the tune of a few thousand dollars on the 1099 (but not for a profit overall)?Here is how it works so you can all stop speculating and assuming some cosmic crisis:
ALL of the funds transaction clearing houses (Paypal, Venmo, Square, etc) are required to REPORT on a 1099-K when total transactions for the year exceed $600. That doesn't mean these will be taxed. There are no withholdings at the source. If you are routinely selling items for profit then you have a business. If you have a business the difference between net sales and your item cost is subject to income and self-employment taxes. However, if you do NOT have a business and have card transactions greater than $600 you report the income on your return and a corresponding credit for "casual transactions not for profit". No tax. Case closed.
For the poshmark, eBay, Etsy and other people who are regularly buying and selling items for a profit, that is a business. For the thrift store kings reselling Savers items for profit: that's also a taxable business. If you have an occasional yard sale and sell more than $600 worth of junk, those are casual sales - no tax. If you're splitting the Sox tickets and have a 1099-K from that? Casual transactions.
What about selling unused personal Bruins tickets through Ticketmaster to the tune of a few thousand dollars on the 1099 (but not for a profit overall)?
Decoding 1099-K Reporting Limits: A Guide for eBay Sellers | TaxAct
The IRS has new reporting thresholds for online sellers. TaxAct and eBay have partnered to explain these tax changes and what they mean for your tax return.www.taxact.com
Yet ebay sent me a 1099k this year, on ~$1200 in sales.
So is the delay for filers, or for eBay on sending out 1099ks (but the taxes are still reportable)?
The actual IRS announcement: IRS announces delay for implementation of $600 reporting threshold for third-party payment platformsā Forms 1099-K | Internal Revenue Service
Translation: We're making it up as we go along?
Ordinary income. Don't report that on Sch C or otherwise subject to self-employment income.
First, 1099 misc claimed as "other" income.
Second, I am not a tax expert but why would I ever claim it on a Sch C when clearly it is not income from self employment or a business?
I guess no good deed goes unpunished.
You seem to know lots about taxes - are you looking for a job? My office is hiring but you'll have to leave the cantankerous comments at home.
It's not like hitting a new tax bracket suddenly increases the tax rate below that bracket so what's the big deal?And @2000 could certainly push a person into a different tax bracket
A 1099k is different than a 1099.
Throw the 1099k in the trash and carry on.
Way to much paranoia and government ass kissing in this thread
If you receive a 1099K and only have 1 or 2 transactions then Schedule 1 would be an appropriate and simpler solution.That's not the proper approach to reporting casual transactions.
Sounds like you need to hand him cashNo idea, but it smells.
Say I loan my kid $1000 so he can cover a car repair, which he pays for, including any applicable sales/service tax. He then repays me when he has the money.
1. The actual transaction (paying for the repair) was taxed. The mechanic also (later) pays income taxes on what he earned.
2. My boy is taxed $240 on the personal loan to him.
3. I'm taxed $240 when he repays me.
Yet only the first line was a taxable transaction.
Sounds like it's time to dump services like paypal and use cash, to me.