Solarstrike
Member
12-20-2021 12:45 PM
source:
New eBay 1099-K tax reporting requirements, PT. 1
"New eBay 1099-K tax reporting requirements
We wanted to follow up with some additional information about how the new IRS tax reporting laws may affect you in 2022, and to let you know that this change requires us to collect Social Security numbers (SSN) or Individual Tax Identification (ITIN) Numbers from all sellers who sell over a certain threshold.
Starting on January 1, 2022, U.S. tax reporting requirements will require all online marketplaces and businesses like eBay which process payments, to issue a Form 1099-K to sellers who receive $600 or more in gross payments. Previously, only sellers with 200 or more transactions and at least $20,000 in annual sales received a Form 1099-K. The new requirements may impact the 2022 tax return that you will file in 2023.
What’s changing with the new requirement
Starting next month, when your 2022 sales reach $600, you will be asked to provide your full 9-digit Social Security number (SSN) or Individual Tax Identification Number (ITIN) before you can continue to sell on eBay. If you have not previously provided your full 9-digit SSN or ITIN, we’ll alert you in your account, and send you an email requesting this information when you reach the sales threshold.
What the IRS does and doesn’t tax
You should also know that many sales on eBay aren’t taxable, so even if you have $600 or more in sales and we issue you a 1099-K, you won’t necessarily be taxed on those sales because in most cases, you wouldn’t owe any taxes on something you sold for less than what you paid for it. For example, if you bought a bike for $1,000 last year, and then sold it on eBay today for $700, it’s unlikely that you would be subject to income tax because your sale price was less than the price you paid for the item. We encourage you to talk to a tax professional when reviewing your 1099-K to determine whether you have taxable income and how to report amounts listed on your 1099-K.
We’ll continue to keep you updated going into 2022. Look for emails and alerts from us that will help explain what’s changed, and what you may need to do next. In the meantime, you can learn more in our FAQ about Form 1099-K and how they affect you.
Thanks for being part of the eBay community.
The eBay Team"
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12-02-2021 09:21 AM
source:
New 1099-K tax reporting requirements, PT.2
"We wanted to share an update about a change to federal tax reporting legislation that will impact people who sell on any online marketplace, including eBay.
Here’s what’s changed
As of January 2022, the IRS will now require all annual online sales over $600 to be reported using Form 1099-K. This requirement previously only applied to sellers with at least 200 transactions and over $20,000 in sales each year. This change will impact your 2022 sales and your 2023 tax filing; it will not apply to your 2021 sales and 2022 1099-K tax forms.
Here’s how this change will impact your 2022 taxes
Many sales on eBay aren’t taxable, so if your sales are over the $600 threshold it doesn’t necessarily mean you will be taxed on those sales. Only goods that are sold for a profit are considered taxable, so you won’t owe any taxes on something you sell for less than what you paid for it. For example, if you bought a bike for $1,000 a few years ago, and then sold it on eBay today for $700, that $700 you made generally would not be subject to income tax.
But you will now need to report these sales as part of your tax return and we’ll continue to share updates that will help you prepare for these changes.
Here’s what we’re doing
This change will impact millions of casual and small business sellers on eBay. It has raised concerns in our selling community and we’re working to bring these concerns to Congress. We believe this new legislation will cause confusion, over-reporting of non-taxable income, and privacy concerns for millions of Americans who are just trying to get by. We are continuing to highlight the undue impact this increase will have on small sellers on eBay, and are urging an increase to the reporting threshold.
Here are some of the issues we’re working to address in our conversations with Congress:
- Overly complicated tax forms for smaller transactions.
- Targets casual sellers who are not set up to handle this kind of tax reporting.
- Doesn’t take into account the selling of used goods, which are rarely taxable income as they are sold at a price below the original purchase price.
Here’s what you can do
We invite you to join the conversation on eBay Main Street, where you can contact Congress on behalf of our community of sellers, small business owners, and entrepreneurs.
We will continue to keep you updated as this legislation evolves. Going into 2022, we’ll also share more detailed information that will help you understand what’s changed so you know what to expect in the upcoming tax year. We’ll keep you posted on how we will support you, and what steps you need to take. In the meantime, we want to remind you that this change will impact your 2022 sales and your 2023 tax filing; it will not apply to your 2021 sales and 2022 1099-K tax forms.
Thanks for being part of the eBay community."
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