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#1
02-01-2018, 01:20 PM
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Kinda OT: PayPal 1099-K - it’s a doozy!
I just got an email that PayPal will be reporting my goods n' services transactions to the IRS as 1099-K income..
All my buying and selling and tinkering and facilitating put me over 200 transactions and $20K in receivables, so now I gotta go account for where all the goods I sold came from so it doesn’t look like I made some huge side-hustle income that would be taxed like my day-job! There’s a lesson here somewhere 
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Io non posso vivere senza la mia strada e la mia bici -- DP Last edited by Clean39T; 02-01-2018 at 09:02 PM. 
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#2
02-01-2018, 01:25 PM
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Cant imagine you would ever pay taxes on that if you can show that you have equal or almost equal expenses to go with those "earnings".
Like 1000£ frames were growing on your tree. Cause they are not right? Hmm now that i think about it, ive been kinda wondering .. 
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#4
02-01-2018, 01:51 PM
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Kinda OT: PayPal 1099-K - it’s a doozy!
I appear to have caused myself quite a headache.
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Io non posso vivere senza la mia strada e la mia bici -- DP Last edited by Clean39T; 02-01-2018 at 09:03 PM.
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#5
02-01-2018, 02:06 PM
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I have been getting 1099-K's for the past few years for a side business I have. I sh*t a brick the first time I saw one because my business was a hobby that sort of morphed.
All I can say is go into Paypal and download a ledger of your transactions. Keep track of the items that you have paid for, so you can prove that all that money you made isn't income. If you paid for things in cash and have some documentation, count those items too. Count the total against your 1099-K total in a Schedule C.
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#6
02-01-2018, 02:13 PM
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^Exactly.
As long as you can prove the you "sold" the item for less than you "bought" the item you will not pay taxes on the PayPal payment. It is extra paperwork on you taxes but this is the world we live in now. The federal government and states have lost too much sales ad use tax on internet transactions so they are trying to get back their piece of the pie. From the IRS website (https://www.irs.gov/businesses/under...-your-1099-k): Form 1099-K, Payment Card and Third Party Network Transactions, is an IRS information return used to report certain payment transactions to improve voluntary tax compliance. You should receive Form 1099-K by January 31st if, in the prior calendar year, you received payments: -from payment card transactions (e.g., debit, credit or stored-value cards), and/or -in settlement of third-party payment network transactions above the minimum reporting thresholds of – ---gross payments that exceed $20,000, AND ---more than 200 such transactions Last edited by NYCfixie; 02-01-2018 at 02:15 PM.
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#7
02-01-2018, 02:16 PM
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200 or $20,000? a hobbyist wouln't come close to either. Clearly, I am a hobbyist and you are an enthusiast.
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#8
02-01-2018, 02:21 PM
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Quote:
This is going to be such a PITA to rectify. So much for having a hobby and trying things out for fun...
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#9
02-01-2018, 02:40 PM
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Sorry, couldn't resist... 
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#10
02-01-2018, 02:43 PM
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#11
02-01-2018, 03:13 PM
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The Australian Taxation Office has been getting sales data from Ebay for several years now and making assessments of tax payable where people are trading regularly and not declaring the income. I went to an ATO seminar where they mentioned that by doing that they had given someone a tax assessment of $125k owing to the taxman based on their Ebay income.
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#12
02-01-2018, 03:33 PM
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Oh damn! Glad I’m under both the 200 transactions and far under the $20,000...but I never make money on here and can prove that.
Dan, I think you’re fine and won’t owe anything since you’re not racking in the dough from your transactions. It will just be a PITA going through everything. Good thing it’s only from 2017? Isn’t that when you joined? 😂 oh man..love ya brother!
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#13
02-01-2018, 03:38 PM
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#14
02-01-2018, 03:51 PM
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Better buy than sell at ebay... :P
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#15
02-01-2018, 03:54 PM
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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....
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