BUYER BEWARE: I got robbed by a hacker.

Murphjd25 said:
If people used two factor authentication there accounts wouldn’t get hacked on here.
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rje58 said:
I certainly don't mind paying the difference as a BUYER between FF and G&S - but as a SELLER, it may keep me from selling knives that I am selling for less than I paid for them, when the government is going to tax me 15% or more on the total amount. It's a no-win situation.

1. Asking for ID (as a buyer) and providing ID (as a seller)
2. Asking for phone number, voice call and text message - Providing phone number, speaking on voice call and sending a text message.
3. Of course feedback score on BF is still a big consideration!

What steps can one take to make sure one is not dealing with a HACKED account?

I don't have the answer, but what I am NOT going to do is buy a knife to check it out and handle it a bit for $175, turn around and sell it after a few months or a year of mostly sitting in the box for $149 minus PP G&S minus shipping costs and THEN get hit with an extra $20-$25 TAX BILL at the end of the year!
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Edited to add: And if I buy the knife NEW from a dealer instead of here on the Exchange, my $175 knife is now a $188 knife (!) due to SALES TAX. In which case I have gone from around $30 $38 to enjoy ( I sometimes consider it 'rent' ) the knife for awhile, to ($188 - ($49+$6+8+22.5)) = $85.50.

I don't mind taking a hit ($15, $38, sometimes more, depending on cost of knife) but I'm going to try not to take any 45%-50% hits on a knife I didn't use much and took very good care of, that was mostly or even totally a safe queen, regardless of price.
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It’s just inflationary. That $177 knife will have to sell for $275 for you to break even. The government had cut itself in for that much in sales tax, income tax, rising postal rates, etc.; and prices will continue to rise as the process goes through additional cycles.

The same inflationary pressures are hitting everything right now and it will continue until the recession gets deep enough to force a change in policy.

n2s
 
hhmoore said:
If you're buying and selling that much, you should have no problem showing purchase and selling prices + related costs (shipping, PayPal fees, etc), thereby eliminating the extra tax hit.
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Just hire a team of accountants and a tax attorney to deal with the IRS….Real simple.

n2s
 
stonproject said:
I dont think you actually are getting taxed by the IRS for selling knives at a loss. People are just switching to the FF to avoid having to prove they didnt make a profit. If you pay vial FF and fund it with a credit card, you can still do charge backs also.
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hhmoore said:
If you're buying and selling that much, you should have no problem showing purchase and selling prices + related costs (shipping, PayPal fees, etc), thereby eliminating the extra tax hit.
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I understand the points you are both making - BUT, unless something changes, my understanding is that once you provide that information to the IRS to prove you did not make a profit, you have to file it as a BUSINESS LOSS. Hobbyists are generally exempt from income tax - but what the government has done is decided that if you receive over $600 in payments from a single payment handling entity, you are a de facto business, issued a 1099 to 'prove it'. Being a business rather than a hobbyist comes with a whole 'nuther set of problems - or benefits - depending on your particular circumstance, priorities and willingness (or unwillingness) to deal with additional bureaucracy and potential hassles.

My understanding is that there is no way to file a 'hobbyist loss' - ONLY a business loss.
 
not2sharp said:
It’s just inflationary. That $177 knife will have to sell for $275 for you to break even. The government had cut itself in for that much in sales tax, income tax, rising postal rates, etc.; and prices will continue to rise as the process goes through additional cycles.

The same inflationary pressures are hitting everything right now and it will continue until the recession gets deep enough to force a change in policy.

n2s
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I'm not trying to break even - that's my point.
 
I apologize if this takes OP’s thread off course

The F/F Vs G/S topic is definitely a common topic.

The problem I’ve found recently is proving I sold at a loss. When most sellers don’t send an invoice for records, probably because they are worried PayPal will freeze their account for mentioning something evil, like knife - or knives.

If we ( sellers / buyers , members of this community ) started sending, or requesting an invoice before a payment through Goods/Services.. would that actually be a valid proof of purchase?

Example.

I buy a knife for $300

I sell the knife 6 weeks later for $280

If I add state taxes, PayPal fees, and shipping to the sale I have two choices:

1) Subtract the amount from from my net
2) add the fees / taxes to my selling price to hopefully break even , or close to even.

Big loss, or too high of a price - not worth it to sell imo. Great for buyers , unless all the fees are added, just buy it new.

If the invoice is a valid form of proof , in the eyes of whatever or whoever is requesting it - then, goods / services should not be an issue with regard to surprise 1099 on cumulative sales over $600

The thieves and scammers are nauseating. This whole situation is frustrating.

I apologize for the clutter Ron Sabbagh Ron Sabbagh I hope something works out in your favor on this one.
 
luethge said:
If the invoice is a valid form of proof , in the eyes of whatever or whoever is requesting it - then, goods / services should not be an issue with regard to surprise 1099 on cumulative sales over $600
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Again, the thing that concerns me is that my understanding is that you cannot file a tax form with a 1099 attached and show that you had NON-BUSINESS losses. When you attach a 1099 and show your net (profit/loss), you are a BUSINESS at that point. In the vast majority of knife hobbyists like myself: a sole proprietorship, unlicensed business as far as the federal government is concerned. Your tax form 'proves it' - to them.

I could be wrong. But my accountant has told me that I can't file a tax form with a 1099 attached where the 1099 reflects 'hobbyist' - NOT business - gains or losses. She could be wrong.

Quote from the Intuit/Turbo Tax website:

"Running a hobby as a business could very possibly trigger an IRS audit."

I don't have anything to hide, but I've never been audited, and I have no wish to be.

There could also be many other potential ramifications from having a "business". Is your state now going to require you to purchase a business license and pay state sales tax if you sell a knife? It boggles the mind where government overreach might take us...!

This doesn't apply just to knife collectors and enthusiasts, but any hobbyists who frequently buy / sell through payment handling systems. The old school knife clubs, stamp clubs, coin clubs, watch clubs, memorabilia clubs, etc. are dying (actually most are already gone) because most of us are using the internet instead.
 
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I’m going to hold on to the knives I planned to sell. Trades with trusted members, after verification that they are who they say they are😂. What a shit storm - make things as complicated as possible to squeeze everyone out of every cent they can get.

“Taxes and death”

Still hoping for quarterly regional blade forums face to face swap meets. I’ll bring the coffee.
 
rje58 said:
What I am NOT going to do is buy a knife to check it out and handle it a bit for $175, turn around and sell it after a few months or a year of mostly sitting in the box for $149 minus PP G&S minus shipping costs and THEN get hit with an extra $20-$25 TAX BILL at the end of the year!
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You took a loss so there'd be No Tax Hit. A little tracking of prices and you'd be good to go.

Do as you wish But I'm saving a lot of money by not paying via F+F.
 
braillediver said:
You took a loss so there'd be No Tax Hit. A little tracking of prices and you'd be good to go.

Do as you wish But I'm saving a lot of money by not paying via F+F.
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I always track prices, I can tell you what I paid for my knives and what I got for the ones that I've sold, and the ones that I traded. All this data lives in a spreadsheet that I keep backed up as well.

AGAIN, I guess you don't care about the potential ramifications of being classified by the federal government as a "sole proprietorship, non-licensed business", and any potential issues, problems - or, in fairness, benefits - that may derive therefrom? What about when the state you live in classifies you as a business, too - and wants you to buy a business license? Unless they change the way they've set this up, there's no limit to the potential government overreach that's possible. Not saying it will happen in every case, but it doesn't seem anymore unlikely to me than issuing 1099s to hobbyists - and reclassifying their tax status to 'business' did a few years ago....''

Have you talked to your accountant? My accountant is human, she's not perfect, but she tells me that I cannot file a 1099 with my tax return to report HOBBY gains/losses - that the very act of filing the tax form and documenting any/gains losses via 1099 will automatically be classified as BUSINESS gains/losses! Thus, in government view, I would have a sole proprietorship, unlicensed business. Does that give you any more pause than merely keeping a few records - which I already do?

As you suggested, we shall both do as we wish - EXCEPT when the government thwarts those wishes by law.
 
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I copied this from a tax help site, and most of us sell our knives at a loss:
Form 1099-K is an IRS informational tax form that is used to report goods and services payments received by a business or individual in the calendar year. While banks and payment service providers, like PayPal and Venmo are required by the IRS to send customers a Form-1099K if they meet the $600 threshold amount, there are certain amounts that may be included on the form that are generally excluded from gross income and therefore are not subject to income tax. This includes:

  • Amounts from selling personal items at a loss
  • Amounts sent as reimbursement
  • Amounts sent as a gift
So, for example, if you purchased a couch for $1200 and sold it for $800, this amount would not be subject to income tax.
 
stonesell said:
So, for example, if you purchased a couch for $1200 and sold it for $800, this amount would not be subject to income tax.
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I think we all understand, in theory, that one does not owe taxes on a loss. The question is how much extra paperwork is required to show the loss?
IRS Schedule C profit or loss business form? State sales tax collection? How much accounting does it take to suck the fun out of a hobby?
 
r8shell said:
I think we all understand, in theory, that one does not owe taxes on a loss. The question is how much extra paperwork is required to show the loss?
IRS Schedule C profit or loss business form? State sales tax collection? How much accounting does it take to suck the fun out of a hobby?
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How much accounting would it take to keep your butt out of a sling? The IRS can wreck someone very easily and this stuff borders on irrational, poorly defined nonsense.

n2s
 
r8shell said:
I think we all understand, in theory, that one does not owe taxes on a loss. The question is how much extra paperwork is required to show the loss?
IRS Schedule C profit or loss business form? State sales tax collection? How much accounting does it take to suck the fun out of a hobby?
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Everyone is in a different tax situation and state laws vary. To be safe it is best to consult with a tax accountant.
 
not2sharp said:
How much accounting would it take to keep your butt out of a sling? The IRS can wreck someone very easily and this stuff borders on irrational, poorly defined nonsense.

n2s
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Many of us fear what the IRS can do, and I have seen it first hand. My brother and I pay an accountant to do our taxes. If there is an audit, he is our agent, and we avoid direct contact with the tax people. My brother was audited twice, and after our accountant was finished, the IRS owed him money both times. I have been lucky so far to avoid that process. That is the only way that I know of to have a fighting chance, but it does take money to pay for the professional help.
 
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