HipStamp And The American Philatelic Society Announce Strategic Partnership

Thanks for the insight, Zebra. I don't believe that Stamp Store loses much money operating, so it seems like a valuable benefit to have for many.

Over the last 10 years some of us have suggested multiple times there be an online way that APS members could upload their own images, fill in the form which could be loaded into the listing database, and then send in their material. This would give the APS Store folks time to review the incoming listings, save them time by not having to scan anything or fill in the basic field info. In my opinion this ought to be the free submission method. I would also keep the existing, value-add 'APS does it all' submission method but at a small fee.

Given that there may be, I assume, the additional cost/time of APS support for the HS listings (buyers asking questions) it seems like offsetting the costs of this process might be a good thing.
Don

The self-posting option is appealing, except for the obstacle of overcoming the scans and descriptions versus having the item. It's not timesaving to then match items to a list once they're received in-house. My ear gets bent on this a few times a year, but chasing the image of the item is the issue. I'm all for suggestions on that piece of it.




We're pulling out the Seller ID number so that it is a separate field and searchable, leaving us room to enhance the descriptions. We have more room to grow here, but thank you.




And don't forget uploading more. We had decent submissions in December and I'd like to keep the momentum going.

Thank you for being a seller with us on StampStore. We activated the APEX cert request and will be monitoring it over the next couple of days before we make a formal announcement. I hope your sales are strong.

Scott

Yes the best suggestion is to stop selling money losing items.

You mention the cost of the vario sheet but not the value of your time cost to insert the stamps into the stock sheet. When examined you will likely find you will lose less money putting the three dollar set into a paper recycle bin rather than trying to sell it. That said the least expensive way to move those $3 net sets is to go with the APS Sales Circuit books where mounting time is quicker and mounts cheaper.

I posted in the APS/ASDA thread that the buyers never value to time expense and other fixed costs undertaken by the seller when reviewing prices for purchase. All buyers want is as close to perfect at the lowest price possible. If that means the seller must lose money to make the sale, no buyer sheds a tear.

Also as the APS expands to where they ship material, they too will begin to feel the steep loses of material sent to certain parts of the world. It will be interesting how the APS will make notations for the areas they will be forced to refrain sending material due to APS covered insurance losses.

Likewise the APS lots offered on HIP with the insurance fees will be less competitive for buyers who will pass the item by. As long as the buyer get their money back, they care not for the loss to the seller. Here the APS must care for the seller's loss as the APS guarantees to cover that loss via insurance.

So to summarize some of the comments in this tread, the APS business model for the Stamp Store model (not the circuits) is old and obsolete in the modern wild wild west of world wide internet stamp sales. I say that for the factualness of the comment not that I agree with the outcome. The APS member model counts on members having ethical standards. That is a good, if not great thing; however such does not exist on the broad internet. Just as a few bad actor shoplifters get retail brick and mortar stores shut due to unmanageable losses, similar bad actors with more expertise exist in larger numbers on the internet.

One question I previously asked but has gone unanswered: Since the APS is the pay agent to the sellers will the APS be issuing the 1099-Ks to sellers who sell over $600 per tax year? Does the APS have the staff to do so or must they pay for a third party to do so. Or, will they just hope the IRS does not notice the APS as a payment processor? Collection of sales taxes will that too be just ignored by the APS as currently HIP does until the state taxing agencies take notice? Lastly has the APS sought legal counsel to address what if any legal exposure the APS may or may not have on the questions without proper action.




Will you still be willing if the APS has to adjust the commission upward to cover the expected and yet to be revealed increased costs especially if the APS find they must issue yearly 1099-Ks.

What cost increases are you expecting?

The IRS postponed implementation for 2022 in anticipation of statutory changes in 2023. The commonly-discussed threshold is $5,000. That will still impact some people, but not nearly as many as $600. We'll see what shakes out as the year progresses.

Scott

Be aware that an ever-increasing number of states have implemented mandatory reporting thresholds at or above that $600 number, but WELL below the current $20,000 federal reporting threshold, so for certain sellers, Forms 1099-K should ALREADY be issued, regardless of any impending or delayed legislation.

As an Illinois resident, I have been receiving Forms 1099-K from both PayPal and eBay for several years now.

Current annual mandatory reporting thresholds:

Arkansas - $2,500
District of Columbia - $600
Illinois - $600
Maryland - $600
Massachusetts - $600
Mississippi - $600.01
New Jersey - $1,000
Vermont - $600
Virginia - $600


Source: https://stripe.com/docs/connect/109...equirements.

When the seller sends in the scan file it should go into a file that is named after a store inventory number and the seller puts that number on the form they send with the item (either the seller names their file whatever and your software remanes it and then sends the seller the inventory number, or you system send the seller the number and makes them name the file with the number before sending it in), so it should be easy to match them up.

When a collector starts trying to consider their time in pricing, they are a dealer and therefore should be including taxes in their prices too.

Ummm. that's not how any of this works. There is no distinction between "collector" and "dealer" with respect to whether taxes are owed.

I've always wondered the same thing. [Now we are really getting off-topic, but it is somewhat related]. First of all, are we talking state sales taxes, or federal (and state) income taxes?

As a collector/trader, selling stamps to a friend at the stamp club, do I need to collect sales tax from him and submit the taxes to the state? Even if I trade over $600 in the course of the year? Can an individual submit sales tax proceeds, or only a business? I wouldn't know how to go about doing that. What about if in January I don't anticipate selling over $600, but by December I sell a couple of hundred dollar items and go over the limit for the year, do I need to go back and collect tax from the previous sales? Or is it my loss out of pocket? Or, is it just sales _over_ $600 that have to be taxed?

Selling on HipStamp or APS or another service, I would expect they (or PayPay payment processor) to know all the rules and manage the taxes accordingly. For out-of-state mail order sales there are (were?) rules about like a buyer in Florida does not have to pay New York state sales taxes on a mail order.

Now what about Income taxes? Can someone explain "hobby income" versus "business income"? From what I understand, a business can deduct costs and expenses from sales revenues, so a stamp that sells for $100 that the dealer paid $70 for, they must report a $30 business income tax on the profits. But hobby income, there are no deductions for costs, so if I as a collector sell a stamp for $100 that I paid $70 for, I need to report the entire $100 as hobby income, with no deductions, is that right? It seems not right, but that's what I was told.

(Feel free to clone this to a new thread and continue the discussion there if the moderators prefer. Or point me to an existing thread if already discussed).

Thanks. :-)

The general state's answer is yes. Reality may differ in your experience.




The government expect tax payments in both circumstances, except if qualifying as a business, you get to deduct certain common and ordinary business expenses plus any business expenses specific you type of business. A hobbyist is not allow those business expenses. Example, the hobbyist buy a stamp for $1 and sells it for $1001. Tax owed on $1000 profit. Business buy a same stamp for $1 and sells if for $1001, the business owes tax only on $200 due to the business related expenses (rent, overhead, advertising, CPA services,etc) because that business shows that it incurred $800 in business expenses to sell the $1001 stamp. Again your reality may vary.

As to state sales tax owed, if the involved jurisdiction have sales tax, in both cases the tax is based upon the sales price of $1001. Again, your reality may vary.

In all cases should the taxing authority take interest in your transaction, your reality will soon match government expectations, with interest and penalties.

Lets not even begin to discuss which taxing authorities want taxes paid when you are swapping (read bartering) stamps even when no cash changes hands. When the 85A was swapped for the C3a block, if done in California, with that much press coverage, likely the state actors would have appeared with their hand out for the sales tax due on each item.

EDIT: These costs and cost discussions belong here as they are part and parcel of the ramifications of selling your stamps publicly and on the internet. (And for spelling)

Does the APS handle transactions directly, or do they utilize a third-party payment processor which since Hipstamp is now involved I guess would make such a processor the fourth party?

I agree but I was trying to make a point that when you factoring in time monetarily into the hobby you are operating like a business. Most collectors do not since it is a leisure activity. The next step to try write off office space in house as part of the business, etc.

For a collector who spent his life collecting spending money on his stamps and then sells his stamps to a dealer or ebay for 10% on the dollar, do they report as a loss on their income tax?

If they can provide supporting documentation substantiating their purchases, presumably it would be treated as a capital loss in the year sold, same as any other disposition of goods (artwork, investment property, etc.), so IMO yes. I don't know off the top of my head what the rules are with respect to being able to carry those losses forward.

It's like anything else. If you buy something and sell later for a profit, the profit is considered income and taxable. Short term and long term capital gains factor into the tax rate. If one can show receipts/invoices for the purchase and document if something was sold for less, the same or more, then that can be used in case there is an audit.

For the casual stamp collector, spending maybe less than $2500 a year and maybe selling the same or less, it's usually a wash. But, for anyone that buys/sells, be prepared for an audit by saving all receipts for purchases and sales.

Most of my items are bought with paypal or a credit card, so I can usually back-track those records if needed. I have a large folder in a cabinet I keep all receipts.