$600 IRS reporting limit for everyone soon 3 3

[Ryan.]

3 minutes ago, the blob said:

And now states are enjoying sales tax revenues from all of this. This is going to cause a lot of people to just stop selling, because of the hassle in figuring out their taxes for $2000 in sales that may or may not produce any taxable profit. States are going to lose revenue as a result.

Cash will be trendy again. 

[ADAMANTIUM]

7 minutes ago, Ryan. said:

Cash will be trendy again. 

I know plenty below the poverty level too that sell their old wares when they upgrade finally. Below the poverty level, you don't file taxes to my knowledge.

These $600 sales will cause all kinds of red flags for them  and it "may or MAY NOT even be taxable revenue"

Anybody have advice for them? it's not like they'll go to the H&R block every year to reconcile to see if they even owe?

Edited March 7, 2021 by ADAMANTIUM

[the blob]

7 minutes ago, Ryan. said:

Let's just say that eBay is not going to get out of this unscathed. 

The paperwork hassle this will create for small sellers is the problem. Taxes now more complicated than ever. Folks who buy stuff for cash and re-sell have no records to prove costs. Selling old stuff? No records. These people are not accountants. $20K and over, yeah, its turning into a real business. States were able to impose sales tax and it was not a big deal because ebay, et al. could just do it automatically. This is completely different. If they want to impose a 2% federal sales tax on these transactions to compensate for the income tax they know they're losing, I wouldn't have an issue. Ebay, etc. could deal with it like local taxes and we don't get crushed under paperwork.

[the blob]

13 minutes ago, ADAMANTIUM said:

I know plenty below the poverty level too that sell their old wares when they upgrade finally. Below the poverty level, you don't file taxes to my knowledge.

These $600 sales will cause all kinds of red flags for them  and it "may or MAY NOT even be taxable revenue"

Anybody have advice for them? it's not like they'll go to the H&R block every year to reconcile to see if they even owe?

You sell the household item you bought for $1000 for $601... is that taxable? It shouldn't be. I spend $3000 a year on comics and sell about the same. if you look at the cost on each book, maybe I have turned a profit and have unsold inventory. they're treating everyone like a real business with this, in which case you wouldn't be taxed at the capital gains rate per item, you'd be taxed like a business. so a business that spends $3000 a year on inventory and makes $3000 in sales (post fees) should not pay any taxes. But putting together the paperwork to document this is a giant PITA. Again, if the feds need blood, i'd much rather just have them add a 2% national sales tax on these transactions.

[Ryan.]

8 minutes ago, the blob said:

The paperwork hassle this will create for small sellers is the problem. Taxes now more complicated than ever. Folks who buy stuff for cash and re-sell have no records to prove costs. Selling old stuff? No records. These people are not accountants. $20K and over, yeah, its turning into a real business. States were able to impose sales tax and it was not a big deal because ebay, et al. could just do it automatically. This is completely different. If they want to impose a 2% federal sales tax on these transactions to compensate for the income tax they know they're losing, I wouldn't have an issue. Ebay, etc. could deal with it like local taxes and we don't get crushed under paperwork.

That would be the preferred route here. Relying on people to self report is not going to create the economic windfall the government thinks it will; people will either find cash only alternatives or just take their 1099s and toss them in the trash. 

[the blob]

Just now, Ryan. said:

That would be the preferred route here. Relying on people to self report is not going to create the economic windfall the government thinks it will; people will either find cash only alternatives or just take their 1099s and toss them in the trash. 

or just make up expenses and claim $200 in profit and then the IRS is going to have to decide whether to audit millions of $3000 a year ebay sellers over this. it is just hassle.

 

[ADAMANTIUM]

1 minute ago, the blob said:

You sell the household item you bought for $1000 for $601... is that taxable? It shouldn't be. I spend $3000 a year on comics and sell about the same. if you look at the cost on each book, maybe I have turned a profit and have unsold inventory. they're treating everyone like a real business with this, in which case you wouldn't be taxed at the capital gains rate per item, you'd be taxed like a business. so a business that spends $3000 a year on inventory and makes $3000 in sales (post fees) should not pay any taxes. But putting together the paperwork to document this is a giant PITA. Again, if the feds need blood, i'd much rather just have them add a 2% national sales tax on these transactions.

your missing my point

if you don't normally file taxes due to being below the poverty level

but you have income being reported to the IRS, that may or MAY NOT be taxable income, then it set's a red flag if you never file period due to assuming you're below the poverty level, 

that's what I said...

21 minutes ago, ADAMANTIUM said:

I know plenty below the poverty level too that sell their old wares when they upgrade finally. Below the poverty level, you don't file taxes to my knowledge.

These $600 sales will cause all kinds of red flags for them  and it "may or MAY NOT even be taxable revenue"

Anybody have advice for them? it's not like they'll go to the H&R block every year to reconcile to see if they even owe?

 

[ADAMANTIUM]

Just now, ADAMANTIUM said:

3 minutes ago, the blob said:

You sell the household item you bought for $1000 for $601... is that taxable? It shouldn't be. I spend $3000 a year on comics and sell about the same. if you look at the cost on each book, maybe I have turned a profit and have unsold inventory. they're treating everyone like a real business with this, in which case you wouldn't be taxed at the capital gains rate per item, you'd be taxed like a business. so a business that spends $3000 a year on inventory and makes $3000 in sales (post fees) should not pay any taxes. But putting together the paperwork to document this is a giant PITA. Again, if the feds need blood, i'd much rather just have them add a 2% national sales tax on these transactions.

your missing my point

if you don't normally file taxes due to being below the poverty level

but you have income being reported to the IRS, that may or MAY NOT be taxable income, then it set's a red flag if you never file period due to assuming you're below the poverty level, 

that's what I said...

22 minutes ago, ADAMANTIUM said:

I know plenty below the poverty level too that sell their old wares when they upgrade finally. Below the poverty level, you don't file taxes to my knowledge.

These $600 sales will cause all kinds of red flags for them  and it "may or MAY NOT even be taxable revenue"

Anybody have advice for them? it's not like they'll go to the H&R block every year to reconcile to see if they even owe?

 

you stating that it is not taxable profit income, doesn't stop the sale being reported and red flags sent up to non-filers....

I said it wasn't taxable, I'm not sure of your response  

[the blob]

4 minutes ago, ADAMANTIUM said:

your missing my point

if you don't normally file taxes due to being below the poverty level

but you have income being reported to the IRS, that may or MAY NOT be taxable income, then it set's a red flag if you never file period due to assuming you're below the poverty level, 

that's what I said...

 

you're supposed to file taxes regardless of income above $12,400 if you have any income. you may wind up getting a big credit/refund, but being poor does not relieve you of any such obligation, although if you don't owe perhaps there are no penalties involved. I filed my taxes years late a few times when I was just busy as heck and knew I had a refund owed to me.

 

Edited March 7, 2021 by the blob

[greggy]

[the blob]

1 minute ago, ADAMANTIUM said:

you stating that it is not taxable profit income, doesn't stop the sale being reported and red flags sent up to non-filers....

I said it wasn't taxable, I'm not sure of your response  

it is only non-taxable if you have a basis to claim there was no profit.

 

[ADAMANTIUM]

2 minutes ago, the blob said:

you're supposed to file taxes regardless of income if you have any income. you may wind up getting a big credit/refund, but being poor does not relieve you of any such obligation, although if you don't owe perhaps there are no penalties involved. I filed my taxes years late a few times when I was just busy as heck and knew I had a refund owed to me.

 

There is also ssi there ssdi.... It's not considered income

Now you have ebay sales being reported that may or may not be taxable due to profit or not profit

Edited March 7, 2021 by ADAMANTIUM

[ADAMANTIUM]

I mean it can get so complicated for people that are related to me and it can't probably given a satisfiable answer other than a tax professional...if it passes lot of ifs and buts and coconuts

 

[the blob]

1 minute ago, ADAMANTIUM said:

There is ssi there ssdi.... It's not considered income

Now you have ebay sales being reported that may or may not be taxable due to profit or not profit

actually i think it is $12,400 and you don't need to file, if you aren't a dependent. it used to be much lower.

yes, as stated, this is going to require a bunch of filings for people who never had to before. a nightmare for people who just aren't adept at this stuff. with that said, if they don't surpass $12,400, it seems to me they don't have file anything anyway? 

[the blob]

it is going to be a big pain in the arse for someone who does the simple form for their regular job. now they're going to have to figure out a schedule C. 

[Shrevvy]

How does this provide pandemic relief?

How does this help those most impacted by COVID?

[ADAMANTIUM]

17 minutes ago, the blob said:

actually i think it is $12,400 and you don't need to file, if you aren't a dependent. it used to be much lower.

yes, as stated, this is going to require a bunch of filings for people who never had to before. a nightmare for people who just aren't adept at this stuff. with that said, if they don't surpass $12,400, it seems to me they don't have file anything anyway? 

that was a big thing for those on ssi ssdi with the stimulus, they get direct deposit, but getting ssi and below the level they don't file

so they had to enter data to get the stimulus situated. My brother just sold his old PS4, I mean, my point was, even if he sells at a loss

he still would have to file taxes to prove it because it is being reported to IRS? someone who doesn't have to file, he knows he'll sell the PS4 for a loss but

because it is being reported, he has to prove it? I mean why bother to sell it at all, why not give it to the less fortunate if he is going to have to reconcile all his electronic "upgrades" at years end  I mean it's silly, cause he would have sold it and not given 2 thoughts, but now, it's well I didn't make a profit but I'll have to give the government proof haha

it all sounds like an over reach, which is why I'm flabbergasted  

Edited March 7, 2021 by ADAMANTIUM

[The Lions Den]

A glimpse into the future..?

 

 

[namisgr]

I'm not finding anything on a lowered reporting requirement for gig workers in the final bill.  Anyone got a link?

Gig work already has an IRS filing requirement, as follows from the IRS website:

You must file a tax return if you have net earnings from self-employment of $400 or more from gig work, even if it's a side job, part-time or temporary.

You must pay tax on income you earn from gig work.

Edited March 7, 2021 by namisgr

[ADAMANTIUM]

Just now, The Lions Den said:

A glimpse into the future..?

 

 

I mean really, can't I just say I gave at the office and be done already