IRS is on it’s way. Are you keeping books?
29 May 2007Everybody knows that the IRS want’s to dip it’s fingers into the eBay pot. It’s not enough that the sales on eBay create millions of dollars in economy boosting sales. It’s not enough that many of the U.S sellers do a great deal of overseas deals. It’s not enough that most of us that are running eBay businesses actually do keep some form of books and do report our income from the business.
The problem is that eBay is just too big to ignore anymore. They’ve left farmers markets and swap meets alone for many years because the added revenue wouldn’t be worth the effort. eBay provides the exact same service, but the revenue is just too big to pass up.
So, how are they going to get at our money? ArsTechnica got a bit of insight into just that subject and felt it appropriate to share with the rest of us.
the current proposal actually expands the definition of a “broker” to include middlemen that don’t actually function as the customer’s agent in a transaction—like eBay, for instance. Brokers currently need to file a form with the IRS that gives the name, address, and gross proceeds of each customer they work for; under the new proposal, many more companies would need to do the reporting.
What they are planning to do is to make it compulsory for eBay to report each and every one of it’s sellers’ gross proceeds. But it goes deeper than that. Many companies like Amazon, overstock, and ubid will have to do the same. Which not only means a lot more paperwork for them, but for you and I too. And more paperwork means higher costs. Those are tax deductible, but they still might end up eating in far enough to cause many sellers to stop selling.
There will be some exceptions. Any seller who does not exceed 100 sales or $5,000 in gross proceeds will be excepted. Which means that most hobby sellers should be fine. But if you’re a struggling small eBay seller, you might get hit for it.
[tags]ebay,auctions,ebay taxes,taxes,tax,amazon,overstock,irs,irs taxes[/tags]
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