First, I get the crux of the rule and do believe people operating businesses should pay their owed taxes, including gig workers who get paid through Paypal or similar (the likely main target of this legislation). And I think sellers of items should use G&S when selling with PP. I am a small business owner (not knife or sales related) and work hard to follow the laws, including keeping meticulous records with Quickbooks and paying a CPA to file my taxes. Heck I even do my best to add up my untaxed online purchases and report them on my state return.
I even suppose it’s fair to pay some tax on used personal items we buy and sell later for a profit. But most of us only lose money, as pointed out many times here, and proving that is the major hassle of this situation. For those saying to just keep receipts, I guess that is the best we can do but even that raises questions. The added complication is that even if you buy all new things and save all your BHQ and KSF and SMKW receipts to show what you paid for items (I save all my order confirmation emails at least) how do I even prove that those things are the things I sold? If PP sends out a 1099 that simply says 5 transactions for $900, who is to say what those things were? Coulda been knives or baseball cards or donuts or used socks! Maybe the buyer enters very detailed info about the sale in the notes when sending money that you could print off later but most times it just says “Funds from nbp on BF, thanks!” or something similar. Casual sales like ours via PP do not have much info included. I see it being quite difficult to correlate these records. Any random five purchase receipts that equal more than $900 would satisfy the requirement to show a loss for an audit, right?
And if this is to be enforced I would fully hope next year’s paperwork would have a couple simple lines for 1099K income and original cost of personal items sold, to eliminate all this confusion.
What a mess. Yikes.
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