Will the new $600 IRS reporting threshold change your habits? - Page 12

chezball · 03-09-2021, 01:25 PM

Quote:

Originally Posted by fulltritty

This is true. I have a photography business I started a few years ago. My travel expenses alone add up to much more than I receive from selling photographs. The first two years I was able to claim the losses and expenses. Beginning last year, I was no longer able to them as the Federal Government considers my "business" a hobby since I'm not making a profit.

collecting001 · 03-09-2021, 01:48 PM

I wonder when this will start? January 2022 I hope. If it started this year it would kind of sucker punch a lot of people

NeedChapmans · 03-09-2021, 03:06 PM

Quote:

Originally Posted by mainerunr

So you can write off expenses but they cannot exceed your income (ie you cannot claim a loss).

No. 2018 the rules changed, no hobby write offs of any kind.

You either file as a business (LLC, S-Corp, Sole Proprietor etc. etc), or you claim 100% of your sales are profits. No in-between.

coltsnsox07 · 03-09-2021, 08:25 PM

Quote:

Originally Posted by collecting001

I wonder when this will start? January 2022 I hope. If it started this year it would kind of sucker punch a lot of people

We're 90% sure it starts January 2022.

mainerunr · 03-09-2021, 08:33 PM

Quote:

Originally Posted by NeedChapmans

No. 2018 the rules changed, no hobby write offs of any kind.

You either file as a business (LLC, S-Corp, Sole Proprietor etc. etc), or you claim 100% of your sales are profits. No in-between.

Yup, helps when you read the whole thing before making oneself look like an ass (me, not you).

chilly55 · 03-09-2021, 08:46 PM

Quote:

Originally Posted by NeedChapmans

So this means that we can't deduct any shipping costs as expenses?

monkeymcgee · 03-09-2021, 08:49 PM

Quote:

Originally Posted by chilly55

So this means that we can't deduct any shipping costs as expenses?

No--the new rules are stupid and onerous

NeedChapmans · 03-09-2021, 10:16 PM

Quote:

Originally Posted by chilly55

So this means that we can't deduct any shipping costs as expenses?

Nothing. Essentially you have three choices.

(1) Start treating this as a business and file as such (thus taking advantages of the tax benefits of being a business, such as being able to deduct expenses).
(2) Swallow the tax bill and pay as if you made 100% profit on your sales
(3) Hide

Depending on how much your 1099 is for and/or how much you sold in other non paper trail avenues, you may not owe very much if you opt for #2. But if you look at your collection and you plan to sell more in 2021 and beyond; now is the time to start considering this a business and getting your ducks in a row.

Panthersfans · 03-09-2021, 10:18 PM

Yes, I will most likely no longer sell on eBay. I do it for a little play money/hobby money, and right now reselling for me is fun (not super profitable but decent) . At that point, saving receipts, logging mileage, etc... will just feel to much like an extra job. No longer fun.

Scarletknight92 · 03-09-2021, 10:56 PM

Ummm. Why can’t anybody report this as a sale of a collectible just like art, coins and etc... https://www.investopedia.com/article...bles-taxed.asp

Baseball cards are considered collectibles

So all your are taxed on is your gain and not 100% of your sale. That’s how I know it.

Anybody want to challenge that? Even tax programs have a special place for collectibles. You insert your sales price and enter the cost and you get a capital gain. Of course you enter the purchase and sales date too so that it can figure if it is a LT or ST gain. Go ahead and try it on Turbo Tax or H&R Block software

NeedChapmans · 03-09-2021, 11:06 PM

Quote:

Originally Posted by Scarletknight92

Ummm. Why can’t anybody report this as a sale of a collectible just like art, coins and etc... https://www.investopedia.com/article...bles-taxed.asp

Baseball cards are considered collectibles

So all your are taxed on is your gain and not 100% of your sale????

This is correct. If you have the paperwork (or the record) for the cost basis of your cards, you can declare the profit/loss. You won't be able to write off expenses in any way.

If you don't have a detailed basis, you're SOL.

fireballmike · 03-10-2021, 11:28 AM

Quote:

Originally Posted by Scarletknight92

Ummm. Why can’t anybody report this as a sale of a collectible just like art, coins and etc... https://www.investopedia.com/article...bles-taxed.asp

Baseball cards are considered collectibles

So all your are taxed on is your gain and not 100% of your sale. That’s how I know it.

So following on this, if you have 50 -100 transactions or more and have the detailed cost basis for each one, can those gains be aggregated and entered as one entry on your schedule D/form 8949 as long as you have the detailed records to back it up and as long as they are all the same gain type (long term or short term)?

I can't imagine the IRS would want to see pages of transactions on those forms.

coltsnsox07 · 03-10-2021, 02:38 PM

Well congress just passed it. Now we see if the $600 affects 2021 or 2022.

Panthersfans · 03-10-2021, 03:03 PM

Quote:

Originally Posted by coltsnsox07

Well congress just passed it. Now we see if the $600 affects 2021 or 2022.

Another question will be , does this affect ebay only, or others like mercari and Facebook marketplace?

discodanman45 · 03-10-2021, 03:05 PM

These new rules will drastically change the hobby in 2022. I for one will stop selling on eBay. Schedule D's are a PITA and high percentage of taxes. I will only trade cards, sell for cash, or make deals with the LCS. It will be better for me as a collector, but it will hurt the hobby.

I pay taxes on my profit under hobby taxes, but I do deduct expenses. I know I can't do this, but I refuse to pay taxes on the entire card sale. Once 1099-K forms come out, it is going to be such a pain that I will refuse to sell anything on eBay. you can't just apply a 1099-K to a schedule D like you can with a Schedule C. You will need to contact the IRS and tell them you are applying your 1099-K to your Schedule D. So if I sell $600 in used DVD's, this will be a nightmare for taxes. This is considered a loss since I paid more for the item, so I never had to deal with this.

The only way I will still sell cards on eBay in 2022 is if they redo the hobby tax. The way things are right now are absolutely ridiculous. If anyone comes back at me with "you need to pay your taxes" I will flip out! I pay taxes on my profits, like taxes should be paid. I am not going to buy a card for $100, sell it for $200 on ebay, ship it for $5 and pay taxes on the entire selling price.

discodanman45 · 03-10-2021, 03:07 PM

Quote:

Originally Posted by Panthersfans

Another question will be , does this affect ebay only, or others like mercari and Facebook marketplace?

Anything that uses PayPal goods and service will be given a 1099-K.

rcmb3220 · 03-10-2021, 03:17 PM

Quote:

Originally Posted by coltsnsox07

Well congress just passed it. Now we see if the $600 affects 2021 or 2022.

I’m pretty sure it’s for 2022. Unless they changed it in the last couple of days.

shrevecity · 03-10-2021, 03:49 PM

Quote:

Originally Posted by rcmb3220

I’m pretty sure it’s for 2022. Unless they changed it in the last couple of days.

It was apparently stricken from the bill in the Senate, so what congress passed does not include it. Its going to happen many of us have been saying it for years that you might as well get prepared for it.

BoxBreaker72 · 03-10-2021, 03:52 PM

Quote:

Originally Posted by shrevecity

It was apparently stricken from the bill in the Senate, so what congress passed does not include it. Its going to happen many of us have been saying it for years that you might as well get prepared for it.

Wait, so the 1099 for anything over 600 wasn't in the final bill?

shrevecity · 03-10-2021, 03:53 PM

Quote:

Originally Posted by BoxBreaker72

Wait, so the 1099 for anything over 600 wasn't in the final bill?

From what I read it was not.

BoxBreaker72 · 03-10-2021, 03:54 PM

Quote:

Originally Posted by shrevecity

From what I read it was not.

Interesting. I agree that everyone needs to prepare for it to happen. And pay taxes obviously.

I would just like to know wtf is going on.

AngusMacGyver · 03-10-2021, 04:00 PM

The worst part of this (now or eventually) happening is having to keep track of all my spending, up until now I could just pretend it didn't add up to anything significant. I'll probably just bite the bullet and pay the taxes so I can keep deluding myself.

Shadowsonic2004 · 03-10-2021, 04:38 PM

Quote:

Originally Posted by rcmb3220

I’m pretty sure it’s for 2022. Unless they changed it in the last couple of days.

I don't think they can legally make that change until 2022 because the 2021 tax season has already started.

bryanscs · 03-10-2021, 04:48 PM

The above statement that it was removed is false.

https://www.congress.gov/117/bills/h...6E5F49D39AB701

Section 9674

Starts after 12/31/21.

chezball · 03-10-2021, 05:19 PM

Quote:

Originally Posted by bryanscs

The above statement that it was removed is false.

https://www.congress.gov/117/bills/h...6E5F49D39AB701

Section 9674

Starts after 12/31/21.

wheel of death.

03-09-2021, 10:56 PM	#285
Scarletknight92 Member Join Date: Jun 2017 Posts: 62	Ummm. Why can’t anybody report this as a sale of a collectible just like art, coins and etc... https://www.investopedia.com/article...bles-taxed.asp Baseball cards are considered collectibles So all your are taxed on is your gain and not 100% of your sale. That’s how I know it. Anybody want to challenge that? Even tax programs have a special place for collectibles. You insert your sales price and enter the cost and you get a capital gain. Of course you enter the purchase and sales date too so that it can figure if it is a LT or ST gain. Go ahead and try it on Turbo Tax or H&R Block software Last edited by Scarletknight92; 03-09-2021 at 11:09 PM.

03-10-2021, 03:05 PM	#290
discodanman45 Member Join Date: Jun 2020 Location: CA Posts: 9,759 danch27	These new rules will drastically change the hobby in 2022. I for one will stop selling on eBay. Schedule D's are a PITA and high percentage of taxes. I will only trade cards, sell for cash, or make deals with the LCS. It will be better for me as a collector, but it will hurt the hobby. I pay taxes on my profit under hobby taxes, but I do deduct expenses. I know I can't do this, but I refuse to pay taxes on the entire card sale. Once 1099-K forms come out, it is going to be such a pain that I will refuse to sell anything on eBay. you can't just apply a 1099-K to a schedule D like you can with a Schedule C. You will need to contact the IRS and tell them you are applying your 1099-K to your Schedule D. So if I sell $600 in used DVD's, this will be a nightmare for taxes. This is considered a loss since I paid more for the item, so I never had to deal with this. The only way I will still sell cards on eBay in 2022 is if they redo the hobby tax. The way things are right now are absolutely ridiculous. If anyone comes back at me with "you need to pay your taxes" I will flip out! I pay taxes on my profits, like taxes should be paid. I am not going to buy a card for $100, sell it for $200 on ebay, ship it for $5 and pay taxes on the entire selling price. __________________ Updating my entire collection on Card Ladder. Lots to go... https://www.cardladder.com/showcase/IOBB7AY2qTVVKSgU9Aqj02kfF4I3

03-10-2021, 04:48 PM	#299
bryanscs Member Join Date: Mar 2015 Location: Elizabethtown, KY Posts: 1,783 elizabethtownsportscards ElizabethtownSportsCards	The above statement that it was removed is false. https://www.congress.gov/117/bills/h...6E5F49D39AB701 Section 9674 Starts after 12/31/21. __________________ Looking to sell your COMC port? I'm buying!

03-09-2021, 01:48 PM	#277
collecting001 Member Join Date: Apr 2019 Posts: 185	I wonder when this will start? January 2022 I hope. If it started this year it would kind of sucker punch a lot of people

03-09-2021, 10:18 PM	#284
Panthersfans Member Join Date: Dec 2014 Location: NC, USA. Posts: 1,054 Kkirks496p	Yes, I will most likely no longer sell on eBay. I do it for a little play money/hobby money, and right now reselling for me is fun (not super profitable but decent) . At that point, saving receipts, logging mileage, etc... will just feel to much like an extra job. No longer fun.

03-10-2021, 02:38 PM	#288
coltsnsox07 Member Join Date: Aug 2011 Posts: 22,168	Well congress just passed it. Now we see if the $600 affects 2021 or 2022.

03-10-2021, 04:00 PM	#297
AngusMacGyver Member Join Date: Jun 2010 Location: Denver CO Posts: 1,465	The worst part of this (now or eventually) happening is having to keep track of all my spending, up until now I could just pretend it didn't add up to anything significant. I'll probably just bite the bullet and pay the taxes so I can keep deluding myself.