[smartd]

On the news tonight:
Ebay Canada sellers with more than $1000.00 in sales will now be reported to the taxman.
Ebay wants to help Revenue Canada realize previously lost tax revenue.
Can the US be far behind?

[timbo]

Originally Posted by smartd

Ebay wants to help Revenue Canada realize previously lost tax revenue.

How public spirited of them

IMHO Ebay will do what's good for Ebay. They must be geting something out of this.

[1250ships]

I doubt it will happen in the US as Ebay is not the one doing the payments. They can't prove you actually received the payments from the buyers. There is no legal mechanism for them to report that to IRS.

[dilligafocau]

The Aussie tax man started doing this earlier this year, not sure what the threshold was but I do remember a few 2nd hand book sellers being most displeased

[Merritec]

Originally Posted by timbo

How public spirited of them

IMHO Ebay will do what's good for Ebay. They must be geting something out of this.

eBay was ordered to comply by the Canadian Courts. Revenue Canada took eBay to court as they wouldn't supply the information willingly. The servers are in the US.
They are going after power sellers (more than $1000 in sales every month) from 2004-2005.
They are looking for Businesses or individuals that don'tclaim the income from selling on eBay, much like they would go after business that sell for cash only and don't report the income

[Merritec]

Originally Posted by 1250ships

I doubt it will happen in the US as Ebay is not the one doing the payments. They can't prove you actually received the payments from the buyers. There is no legal mechanism for them to report that to IRS.

I am guessing that the IRS could do the same if it wanted to. eBay can prove you had the sale, and can prove you were paid. (that check box of payment recieved) plus if you weren't paid there would be a dispute.
They are going after the large sellers first. If you report the income, you are fine. If you don't, I would expect to be audited. That can't be fun with the IRS.

I can't see them going after the Hobby seller who sells $1000 in a year. Too much work for too little return. But I am sure there are Powersellers making $100,000's and don't report any of it.

[TopHat]

The only way Ebay can prove that payment was received is if the payment went through Paypal, since Paypal is a sub of Ebay.

[Cruver Collecter]

State of Louisiana was even trying to go this line with some legislation last year. It was something along the lines of, if you had more than $1,000 in sales during course of a year you had to be listed has an auctioneer. That way they got some sort of fee to be an auctioneer off of you in addition to sales tax. Made it easy on myself and just moved over to Texas.

[1250ships]

Originally Posted by TopHat

The only way Ebay can prove that payment was received is if the payment went through Paypal, since Paypal is a sub of Ebay.

Paypal is a whole nother story. Ebay can not by itself legally prove that the sale was made. There are plenty of disputes settled outside of the Ebay though I admit the IRS might not be willing to believe it if you said you sold everything for half price or some other story. Ebay and Paypal have consistently said they will only provide data after being served with a subpoena.

Technically sales on Ebay are income and should be reported. But the flip side is that if you paid more for the item than you sold it for you have a loss and could claim that on your taxes. You could also claim any expenses such as the cost of internet access required to get to Ebay. At the moment the only way you would get caught is if the IRS does an audit and finds you have extra money floating around that you didn't report. If you made a few hundred dollars buying and selling diecast planes you are probably in the clear but if you were doing thousands of dollars worth of transactions they will problem see that as a business and you'll be facing a big retro-active tax bill.