Paypal wants a tax number

[Bassmaster96]

Okay, so apparently I have sold too much. Paypal wants a tax number because I have had over 200 transactions. Lots of those I made no profit on. What is the deal?

 

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[DeepseekerADS]

ooooooooo... Bad JuJu Bwana - as they would say in the old Tarzan movies when danger lurked....

 

[Jim in Idaho]

They won't do anything with the number, but include it with their tax reports to Uncle Sam. Usually you have to give a federal tax ID #, or, if you don't have one, your SS#. They aren't going to withhold money.
Jim

 

[austin]

Que lastima! Lo siento mucho....

 

[Nugget Hog]

That is so they can send you a 1099-k. They also report to the IRS how much money you made with paypal. Just feel good that your funding some overpaid bureaucrat. lol
They started this in 2012.

 

[Oregon Viking]

That is so they can send you a 1099-k. They also report to the IRS how much money you made with paypal. Just feel good that your funding some overpaid bureaucrat. lol
They started this in 2012.

I think it is 200 sales or 20,000 bucks which ever comes first.
I think that sucks because I do not keep track of what I paid...when I bought it..or the "profit" or loss..or expenses...
I make sure I do not get 200 sales.
Taxes: The IRS introduces the 1099-K (AKA PayPal 1099) from your online payment provider

 

[Bassmaster96]

Well, here's the problem. Like Viking said, I buy a lot, break even, and then keep what is left a lot of the time. Therefore I am not making a profit, so I shouldn't have to pay taxes on it right? Thanks for your replies!

 

[JustinNH]

200 sales AND 20k.
Not one or the other

So you can have a million sales and end at $19,900 and they will not report the earnings

 

[JustinNH]

Well, here's the problem. Like Viking said, I buy a lot, break even, and then keep what is left a lot of the time. Therefore I am not making a profit, so I shouldn't have to pay taxes on it right? Thanks for your replies!

Even if you break 200/$20k, you can still report all expenses (costs, supplies, postage, fees, mileage, etc) to lower that amount. If you break even, then correct, you will not owe any taxes.

 

[ivan salis]

as a "independent "small " business -- which is what the IRS thinks of you * you have to keep track of A what did you buy it for--- B what it"cost" to clean it ,fix it and sell it *?--- and C what was its final selling price? -- and once you take A+ B --add it together and deduct it from C --what if any "profits" did you make ? D ---because old uncle sugar wants a "cut" of "D" money

 

[Paleo_joe]

as a "independent "small " business -- which is what the IRS thinks of you * you have to keep track of A what did you buy it for--- B what it"cost" to clean it ,fix it and sell it *?--- and C what was its final selling price? -- and once you take A+ B --add it together and deduct it from C --what if any "profits" did you make ? D ---because old uncle sugar wants a "cut" of "D" money

Don't forget mileage (at the IRS rate) in the costs! That can be huge. I also take the home office deduction. I'm not scared of an audit because everything is above board. There's nothing for the IRS to find and anyway they have a lot bigger fish to fry. I know a guy whose home office deductions were included in an audit, but he was really pushing the envelope with it and the upshot was it got cut back to a defensible amount.

What is strange is that I surely I have had 200 sales this year but haven't gotten a form.

 

[Oregon Viking]

200 sales AND 20k.
Not one or the other

So you can have a million sales and end at $19,900 and they will not report the earnings

Thank you for that information. I think the 1099K is sent out in February along with W2's.

 

[diggummup]

Welcome to America where nothing is certain but death and taxes.

 

[diggummup]

200 sales AND 20k.
Not one or the other

So you can have a million sales and end at $19,900 and they will not report the earnings

Someone who knows the facts. This has been discussed before on here. Technically your supposed to claim any and all monies/profits made on ebay, no matter how small. I'm sure 9 ot of 10 (or more) "small" sellers don't.

 

[Bassmaster96]

So basically, it is not going to affect me at all until I get 200 sales and $20,000?

 

[diggummup]

So basically, it is not going to affect me at all until I get 200 sales and $20,000?

Technically speaking, correct. Make sure it isn't a spoof email or something. Could be someone fishing for info.

 

[Bassmaster96]

Yeah, paypal said it was legit, and basically JustinNH nailed it. Thanks a lot for your help guys!

 

[JustinNH]

Yeah, paypal said it was legit, and basically JustinNH nailed it. Thanks a lot for your help guys!

Happy to help!