Kinda OT: PayPal 1099-K - it’s a doozy!

[ultraman6970]

There's no money in cycling stuff.

[charliedid]

You don't need an accountant, you need a therapist ;-)

[Clean39T]

Originally Posted by charliedid

You don't need an accountant, you need a therapist ;-)

Probably true.

[Clean39T]

Originally Posted by ultraman6970

There's no money in cycling stuff.

Which line do I write that in on my 1040?

[Clean39T]

Originally Posted by benb

Sorry if you're doing $20k+ start keeping books and don't spend all the money immediately, save it to pay taxes and such.

If you were keeping books it's very very hard for me to believe you actually made any money on buying/selling used bike stuff though, so no problem, you won't actually owe any taxes.

The basis for all our bike crap is almost always going to be more than the net proceeds unfortunately....

Didn’t realize I had to keep books for something I view as a hobby, but the info is all out there to prove I suck at running a hobby as a business...it’s just going to take some serious data-mining.

[ultraman6970]

IN the one that says.... "quote your fab author to get off the hook"

I have a friend that usually was buying like tons of junk like for a dollar and then he was dropping all of that to the salvation army to get the tax deduction slips.

Originally Posted by Clean39T

Which line do I write that in on my 1040?

[Pegoready]

I use GoDaddy Bookkeeping (AKA Outright) to do the data mining for me. You could do the same and I think it'll automatically get all your transactions. The first year is pretty cheap then it ramps up but you can cancel.

The cash deals where you hooked up Paceline members and accepted paypal reimbursements... hopefully you have some emails to fall back on to act as documentation. You can manually enter those cash transactions.

Yeah, it's a PITA. It'll take you a day to sort through it I'm sure.

[Spaghetti Legs]

Originally Posted by ultraman6970

There's no money in cycling stuff.

Boy there’s a lot of money gone in my cycling stuff.

Good luck 39, sounds like a true buzz kill on the hobby.

[glepore]

man up and take a loss

[Clean39T]

Originally Posted by glepore

man up and take a loss

Not sure what you’re saying...my bank account after buying and selling already is what it is...and I’m fine with that...

[Clean39T]

With a little distance from this, I’ve adjusted my viewpoint to roll with the tide.

It really is what it is - PayPal obviously has no way to sift through who is doing what. And if someone does run a side-hustle flipping bikes and turns a net-profit on the year, then they deserve to be taxed just like I’m taxed for my day job.

In my case though, I choose to be a hobby tinkerer and try a bunch of bikes and parts this past year by buying used stuff and then reselling it. I’ve expressly NOT tried to flip things or turn a profit, ie. I ain’t running a side-hustle.

But the law is the law, and so now I gotta sort things out and recreate my year of the payables side so I don’t get stuck paying taxes because the IRS can only see the receivables side of the ledger so far.

I actually think it’s going to be kind of fun to look back through everything - a trip down memory lane if you will.

And I’ll be sure to keep records this year - even though I don’t plan to do 1/10th of the churning and burning I did in 2017.

I do have a small pile to move along first though...

[Ralph]

Same principal as when I sell a stock. Small or large amount. I get a 1099 (showing gross proceeds) forcing me to account for it's cost basis.

Using a tax program like turbo tax or similar....believe they ask you if you had any 1099's from stuff like tat.....you list the proceeds from sale and put in a cost. Not sure if you would have to list separately. I would try not too....then roughly figure out my cost....making sure I did not show a profit. If a loss.....believe you could subtract up to $3000 in losses from your taxable income. (actually if it is treated same as a stock.....you can apply losses against any gains, then deduct another $3000 from your income) Not sure if you can do that with a hobby....maybe worth making it a business.....but check it out. Probably would add a couple minutes to doing my returns. Not a big deal really.

[CDM]

Many of us could call this a business and claim a loss on schedule c. Who wants to do it..and let us know how it goes?

[NYCfixie]

Originally Posted by CDM

Many of us could call this a business and claim a loss on schedule c. Who wants to do it..and let us know how it goes?

You are asking for an audit. You wold have to show multiple years and some of them would need to show a profit. You cannot run a business solely for the purpose of running a loss. Any good accountant would tell you that - or just advise that you should become a gambler and loose it all in Vegas.

[NYCfixie]

I did the same thing for a few years when I still owned a home and had a basement workshop. For me, it soon became a chore - and no longer fun - to manage all the buys, build-ups, tear-downs, sells, and deal with all the a-holes when I had to sell stuff on craigslist and/or eBay to get rid of it. I was spending so much time managing everything and not enough time riding my bike(s).

Needless to say, as part of an overall lifestyle downsizing, I sold everything (bikes, parts, tools, workstand, etc.) and bought my first custom bike. Now I just ride my bike and let someone else service it. Not judging you (not that I want to be judged either), but sharing that for me it stopped being fun so I changed my approach.

Take care of the paperwork and then get back to the fun part - riding your bike(s).

Originally Posted by Clean39T

With a little distance from this, I’ve adjusted my viewpoint to roll with the tide.

It really is what it is - PayPal obviously has no way to sift through who is doing what. And if someone does run a side-hustle flipping bikes and turns a net-profit on the year, then they deserve to be taxed just like I’m taxed for my day job.

In my case though, I choose to be a hobby tinkerer and try a bunch of bikes and parts this past year by buying used stuff and then reselling it. I’ve expressly NOT tried to flip things or turn a profit, ie. I ain’t running a side-hustle.

But the law is the law, and so now I gotta sort things out and recreate my year of the payables side so I don’t get stuck paying taxes because the IRS can only see the receivables side of the ledger so far.

I actually think it’s going to be kind of fun to look back through everything - a trip down memory lane if you will.

And I’ll be sure to keep records this year - even though I don’t plan to do 1/10th of the churning and burning I did in 2017.

I do have a small pile to move along first though...