E Bay Sales

[warren]

I can't imagine the federal government would get involved in this.

Income is taxed. Hence the term "income tax." Receipts from pipe sales are income. For the occasional seller ... probably no problem. But, if you are in the business of selling pipes and aren't reporting such ... a surprise might be awaiting you.

 

[mawnansmiff]

Though not directly connected to the OP's question, it has always baffled me as to why tax is charged on second hand goods.

I've often seen second hand goods being offered for sale at a price plus VAT. Surely VAT was charged to the original purchaser so why should it be charged again?

Regards,

Jay.

 

[Kobold]

Though not directly connected to the OP's question, it has always baffled me as to why tax is charged on second hand goods.

I've often seen second hand goods being offered for sale at a price plus VAT. Surely VAT was charged to the original purchaser so why should it be charged again?

Regards,

Jay.

I’ve always thought this myself.

 

[drrock]

They’ll issue the 1099’s . You still get to account for cost of goods sold with the taxes , so not like you pay tax on the gross amount . I can and plan on taking a tax loss on my collectible pipes to offset other collectible gains within the tax code . Overly complicated for most tax filers imho but they squeezing the lemon

Does this mean that, for income tax purposes, I could deduct the initial cost of the pipes I sold from the gross amount on the 1099?

Generally I've been selling my pipes for less than I paid for them & am able to document the original purchase price. If I am able to deduct the initial cost from the amount in the 1099 I would actually have a net tax loss.

I'm not an accountant & I suspect my question is for someone who is one...

 

[cosmicfolklore]

Does this mean that, for income tax purposes, I could deduct the initial cost of the pipes I sold from the gross amount on the 1099?

Absolutely. In fact if you didn't, you'd be hurting yourself. A 1099 doesn't mean that you have to pay taxes on what is on that form. It merely says that you sold a thing for that much. If you are trading pipes as a hobby, you really should be keeping books. It is not just pipes, but even folks that sell any hobby stuff really should be keeping books... for your sake, as well as the tax man.

 

[sablebrush52]

Does this mean that, for income tax purposes, I could deduct the initial cost of the pipes I sold from the gross amount on the 1099?

Generally I've been selling my pipes for less than I paid for them & am able to document the original purchase price. If I am able to deduct the initial cost from the amount in the 1099 I would actually have a net tax loss.

I'm not an accountant & I suspect my question is for someone who is one...

Absolutely. Taxable business income is less costs, so if you're taking a business loss you not only do not pay income tax on that loss, you can apply that loss against other business profits or a percentage of it against income, such as salary. It's called tax harvesting.

 

[sablebrush52]

Though not directly connected to the OP's question, it has always baffled me as to why tax is charged on second hand goods.

I've often seen second hand goods being offered for sale at a price plus VAT. Surely VAT was charged to the original purchaser so why should it be charged again?

Regards,

Jay.

Simply put, it's economic activity and economic activity is largely subject to tax.

 

[cosmicfolklore]

Does this mean that, for income tax purposes, I could deduct the initial cost of the pipes I sold from the gross amount on the 1099?

Generally I've been selling my pipes for less than I paid for them & am able to document the original purchase price. If I am able to deduct the initial cost from the amount in the 1099 I would actually have a net tax loss.

I'm not an accountant & I suspect my question is for someone who is one...

Get you a business license with a tax ID, and stop paying sales tax on your sandpaper, solvents, and all of the things you use to restore pipes, and write all of that off also. The only real pain in the ass is when you have to inventory all of that shit.

 

[alan73]

Does this mean that, for income tax purposes, I could deduct the initial cost of the pipes I sold from the gross amount on the 1099?

Generally I've been selling my pipes for less than I paid for them & am able to document the original purchase price. If I am able to deduct the initial cost from the amount in the 1099 I would actually have a net tax loss.

I'm not an accountant & I suspect my question is for someone who is one...

Yes deduct cost of pipe less depreciation for use , as cost basis for use , murky area if the pipe is smoked , if unsmoked definitely a collectible loss or gain… can’t claim as a loss versus regular income but can claim a collectible loss versus other collectibles that you have a gain in

 

[peteguy]

When I first saw this change I thought to myself, "have they just opened a can of worms? If I subtract all my pipe related expenses for this hobby from the pipes I move for $$, I am going to claim a huge loss every year. So they may think they are going after large sums but not from me, they will be paying me back.