Quick update on this, PayPal will not correct for any payments that we’re refunded. So in my case IRS will get a 1099-K for me that grossly overstates my actual payments received and I guess I also have to provide documentation of the refunds as well. Lovely. All for $580 net to me in 2021 on items I paid about $800 for. Congrats IRS, you’re really doing a bang up job of closing the tax gap with this!!Apologies if this has been covered, but just received my 1099-K and wanted to share two points. While I was under the threshold based on net to me (I think I took in like $580 this year, woohoo!), I was just over it for pre-fee sales. So point number 1 is the dollar amount they report to IRS is based on the pre-fee value, meaning we're essentially being asked to report money already taken as a fee as income. Point number 2 is they also included several refunded transactions within the total amount, so my dollar amount is significantly higher than what it should be. Just had to call PayPal to file for an amendment. So take a close look at your forms folks, if they're including re-funded transactions within the income then that just adds another layer of annoyance to this process!
On the plus side, PayPal was actually quite easy to get on the phone and get someone pretty helpful to chat with, so far so good on that and no hard feelings towards them, the poor PP tax office is being pretty inundated at the moment dealing with us angry knife nuts
. Last year there was a discrepancy too, but was only a couple hundred dollars, and I think it may have been because one sale was actually F&F. So, totally confused, but at least it's been in my favor.That has been pretty typical with them. They report income transactions and don't get into the details of refunds. I have always had to deal with that as part of my normal business bookkeeping in my ledger and there may be a spot of the Schedule C to deal with refunds.
Definitely possible to address this with the Schedule C, but I really don't feel comfortable with pretending this is a small business in my case since I'm not doing it to make money, and it also doesn't seem right that if I'm selling at a loss that I would get to count that loss to reduce my taxable income. Still playing with my options, but it's always possible just to enter miscellaneous "other" income, include the 1099-K and receipts there, and call it a day. If the IRS really wants to waste their time to see whether I need to be paying a few extra dollars in taxes then so be it
Add income tax and sales tax to the sale of a knife that we already paid taxes on? You don't see the big deal? How much does income tax and sales tax add to the sale of a 600.00 knife?
First off, ease up on the personal crap. I know you’re capable of having a discussion without acting childish.Add income tax and sales tax to the sale of a knife that we already paid taxes on? You don't see the big deal? How much does income tax and sales tax add to the sale of a 600.00 knife?
Commerical sales of goods is what they are calling it. Nothing commercial about it.
Not a shocker coming from you.
