http://www.auctiva.com/edu/entry.aspx?id=IRS-to-Regulate-Tax-Prep-in-2011
quote...
Electronic-payment processors such as PayPal and credit card companies will have to report merchant sales if they surpass $20,000 a year, or if a seller receives more than 200 payments in a year.
*Looks like I will be moving back to accepting cash or money orders and stop selling with paypal or ebay. 1|1|Don't understand this...|Julie|juliejulie97@hotmail.com|12:57:52|01/14/2010|
Anybody with info.. 2|2|the best I understand it|cinda68|lacinda68@gmail.com|16:08:49|01/14/2010|
Paypal and other payment processing services will report your seller's income to the IRS, to tax you on that income. I can see them doing this to those who run businesses on ebay but there are plenty of small sellers who don't derive their income from ebay. I guess if I sell more than 200 items in a year, then paypal will report the amount for that year to the IRS. It probably drives the IRS nuts that people like us can make a few bucks here and there and they just want a chunk of it. Here's another article about it:
http://www.auctiva.com/edu/entry.aspx?id=Credit-Cards,-PayPal-to-Report-Sellers%27-Income-to-IRS 3|1|Looks like Paypal will now ask for your social security number...|Arizona|vbj48@cox.net|16:49:53|01/14/2010|
according the section where you click inside of this article. 4|1|There is a discussion in the comments section after the article on if it's 20K a year or 200 payments or if it's 20K a year and 200 payments.|qponsandy|qpons4trade@ameritech.net|12:16:56|01/15/2010|
If it is 20K or 200 payments, then I'll have to quit ebay and even accepting paypal payments for coupon trading. I do get more than 200 payments per year (this would be on average 17/month) but I do not make anywhere near the 20K.
I'll be doing more research on this before I decide what to do. If paypal wants my social security number then I'll have to think long and hard about that. I don't like giving out my SS# unless it's absolutely necessary.
I do pay my fair share of taxes. But us small sellers and traders will be the ones who will lose in the long run.
5|1|Not sure how they will really be able to do this...|Julie|juliejulie97@hotmail.com|12:25:27|01/15/2010|
Since you can put money into paypal that is your own/get gifts etc. through it. I don't know! It just does not seem like it will be fair. My accountant says (have not talked to him abou this yet) they could issue you a W2 for the amount taken into the paypal account and then it would be your job to prove expenses etc. I do report what I sell on ebay to the IRS. I already pay taxes on it. I just keep my own records. My accountant says you are to report everything that is profit that you sell (even yard sales)! Although he says no one reports yard sales. 6|2|That's because most people don't PROFIT from yard sales|Abbicca|Abbicca@insightbb.com|13:18:23|01/15/2010|
Most people sell used, outgrown, etc items at yard sales...and they sell them for substantially LESS than what they bought them for.....so no PROFIT. Sick, twisted, couponers like us often sell stockpiles at yard sales...and we DO sell them for more than we paid for them. I report stockpile sales minus expenses....usually a small profit every year (after all, what I paid for the item plus tax, coupon cost, advertising, booth rent at community yard sales, ...and mileage to yard sale site is all expenses against it).
7|3|Yo Amy are you gonna be home later? |teener|teenerzacsneenee@yahoo.com|13:24:17|01/15/2010|
>Posted on Jan-15-10 at 01:18 PM (Eastern)
>by 74.132.217.118Most people sell used, outgrown,
>etc items at yard sales...and they
>sell them for substantially LESS than
>what they bought them for.....so no
>PROFIT. Sick, twisted, couponers like
>us often sell stockpiles at yard
>sales...and we DO sell them for
>more than we paid for them.
> I report stockpile sales minus
>expenses....usually a small profit every year
>(after all, what I paid for
>the item plus tax, coupon cost,
>advertising, booth rent at community yard
>sales, ...and mileage to yard sale
>site is all expenses against it).
>