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seahawks4ever
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*Disclaimer: I am doing this real quick and this is my view on it. The facts I think are correct however, I have not researched this all the way yet*
So starting in 2011, Congress has passed a new law that requires paypal to send a 1099-K to any person who either gets more than $20000 per year OR has more than 200 transactions in which the person gets paid. This 1099-K also goes to the IRS. What does it mean? It means that all casual eBayers who sell more than 200 items will get one of these and have to report it on their tax return.
In essence, the IRS knows that they have been losing tons of potential taxes because of eBay for awhile but finally, they are doing something about it. This is going to hit the card collecting world hard in my opinion as casual ebayers (like myself) will be reluctant to list too much. I see eBay listings tanking badly.
Now, if I understand the law correctly, you have to be paid through PAYPAL. If you are looking to still sell cards, I believe a place like Check Out My Cards is going to be where you go. I have never sold there but from what I understand, when you sell a card, the money sits in a 'holding' account until you decide to cash it out. While many people aren't huge fans of the 20% COMC takes out when you cash out, I could see this as being a bit of a loophole in the law.
If you are a seller, be careful going forward. I would hate to hear someone post on here in January of 2012 saying, "WTF?! I got something from paypal saying I made $25,000!" because that could kill a person as far as income taxes. All of it would be self employment taxable, tacking a 15.3% S/E tax. On $25,000, we are talking about $3825 of additional tax!
I will be reading furthur into the law and will be happy to look into anything for y'all.
So starting in 2011, Congress has passed a new law that requires paypal to send a 1099-K to any person who either gets more than $20000 per year OR has more than 200 transactions in which the person gets paid. This 1099-K also goes to the IRS. What does it mean? It means that all casual eBayers who sell more than 200 items will get one of these and have to report it on their tax return.
In essence, the IRS knows that they have been losing tons of potential taxes because of eBay for awhile but finally, they are doing something about it. This is going to hit the card collecting world hard in my opinion as casual ebayers (like myself) will be reluctant to list too much. I see eBay listings tanking badly.
Now, if I understand the law correctly, you have to be paid through PAYPAL. If you are looking to still sell cards, I believe a place like Check Out My Cards is going to be where you go. I have never sold there but from what I understand, when you sell a card, the money sits in a 'holding' account until you decide to cash it out. While many people aren't huge fans of the 20% COMC takes out when you cash out, I could see this as being a bit of a loophole in the law.
If you are a seller, be careful going forward. I would hate to hear someone post on here in January of 2012 saying, "WTF?! I got something from paypal saying I made $25,000!" because that could kill a person as far as income taxes. All of it would be self employment taxable, tacking a 15.3% S/E tax. On $25,000, we are talking about $3825 of additional tax!
I will be reading furthur into the law and will be happy to look into anything for y'all.
