Ebay Now Collects Sales Tax

Thanks Battlestamps. ebay does the tax collecting for AUS government. There is no state taxes here. Import tax I think is still for items over $1,000




Could I have seen the tax charge to the US seller?

Why does US customs need to clear a US item going to Australia?

Well stated, CandadaStamp. This is getting really bad. I'm going to accelerate the selling of my stamps and coins before too many more states fall under fee bay's tax collection realm.

Selling my stamps to dealers at 5 cents on the dollar is starting to look reasonable again.

I think it all started when ebay went from Hobbyist buying and selling items to being a GIANT Retail Market for the Entire World. I don't think the "3rd party" market should be allowed on ebay.

Eventually hobbyist such as stamp and coin collectors are going to be forced out with too many rules, regulations and TAX!

There is a multitude of collectors that buy lots and/or collections, remove what they want to keep, and resell the remainder back on ebay. They don't add to their in come; they are simply trying to recover some of their expenditure for the material they don't want to keep. They are NOT a business and should NEVER be taxed!!!

Maybe there should be eBays 1 and 2

ebay 1. Commercial retail/wholesale (taxable if it applies)

ebay 2. Hobbyist (no tax)

This isn't an issue for ebay, it's an issue for the state and national governments in the USp. And ebay is not genuinely able to differentiate between a "hobbyist" and a business.

Somehow Paypal has chosen $20,000 in annual sales as the threshold for reporting income to the Government. I think most hobbyists fall under this threshold.

I am pretty sure that global warming is ebay's fault too.

Hi Ken,
If $20,000 or more was deposited into your Paypal (not a part of ebay, any transactions) account within 200 transactions for a calendar year you would receive a 1099K. Amazon also issues a 1099k at the same 20k level.
Don

https://www.paypal.com/us/smarthelp...1099k-faq729

The amount probably was proposed by one of the states involved, as corresponding to either (a) the jurisdictional limit for a lawsuit against the seller in state Superior Court or equivalent, or (b) the smallest amount that the state's attorneys and tax department are willing to prosecute or pursue in a lawsuit. They have transactional costs and small litigation would not make sense.

It should be borne in mind that ebay did not create this process willingly or to intentionally harm sellers. States would have sent demand letters stating their legal position, negotiations ensued and the process was set up as a condition of the states not suing ebay in multiple multi-million dollar cases. ebay is doing it because the states have strong-armed them. The states are doing it because their duly elected representatives think it's good policy. The way to end it is to fire those representatives in the 2020 elections.

Paypal reports amounts less than 20k to the Feds. A lot less.

About 4 years ago Paypal started sending out 1099s to customers who had more than $20,000 in ebay payments. The 1st year it was experimental and the forms weren't submitted to IRS, but I know I used their information in my tax preparations. Right from the start they were pretty skimpy with information regarding what was included such as refunds and fees. I think the 2nd year they sent us 1099K forms and sent them to the IRS. I sold some sports tickets on Stubhub and the receipts were transferred to Paypal but these receipts were not included on the 1099 form. All this Paypal activity preceded the States sales tax issues. With regards to Paypal reporting amounts less than $20K I have no knowledge but I don't think they would report $ to IRS without notifying the customer.

As a side note there is no hobbyist exception for income tax. Fail to report (or to keep records sufficient to show that you're not earning a profit when allocating a fair basis to what you sell and what you keep) at your own risk.

Australia ebay have had the reporting of sales above $20,000 for years. Then about 2 years ago they were forced to report sellers that sold over $10,000 per year.

A business tax # stops ebay having a need to report income.

But 10% added by force on to ebay for incoming purchases from outside Australia does not seem to matter if you are a business or not.

Every time the rules get changed so does the way we do business. It is always doom & gloom when things get changed. But changes made 5 years ago do not even get a mention these days.

If you are so unstable with changes like one being discussed here maybe you need to stop selling. If you can not roll with the punches then stop punching back!

I called Kelleher yesterday to ask if the "Collections Sale" was still on schedule. While I had them on the phone I asked about their sales tax policy regarding shipments to Florida. Now they are going to charge sales tax unless I have a reseller certificate. I'm glad I asked and if you are an out of state reseller you should probably call them.

I just got something in a recent Kelleher sale, and it was the first time I've had them assess sales tax on me for a purchase.

I'm sorry I missed this thread earlier. So much misinformation.

People are mixing sales tax and income tax. Not the same.

ebay is collecting sales tax in certain states not out of choice but because they are required to by law, due to the Marketplace Fairness Act and other legislation. It is inevitable that they will ultimately be collecting sales tax for all states that have a sales tax; it's only a matter of time before additional states pass similar laws to those already on the books.

Sadly, sellers will likely bear the brunt of negative ratings and stars, not realizing that it is ebay not the individual sellers collecting the tax, and that it's not optional.

Regarding the income tax reporting requirement in the U.S., PayPal did not "choose" the $20,000 threshold for federal income reporting. The two-pronged test of $20,000 in receipts *AND* 200 transactions is mandated by law, and applies to all 3rd-party payment processors (e.g., Google Pay, Samsung Pay, merchant credit card processors, etc.).

Additionally, several states have lower reporting thresholds than the federal thresholds, so depending on your state of residence, you may receive a 1099-K even if your dollar amount received or the number of transactions fall well below the federal amounts. Again, not PayPal's fault.

If you want to blame someone for either of these two tax implementations, blame your state and federal congresscritters.

I haven't had pushback on the sales Tax charges yet but I'm expecting huge pushback from the wife when I tell her to report Florida Sales Tax. I just read the rules quickly but it looks like they want their sales tax quarterly but they also want us to report state by state sales too. This will take several hours!! There might be a $4 Million threshold for reporting and I'm hoping we can squeeze under it.

"Congressvritters" I love it!