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NEWS: IRS May Consider eBay Sales Taxable Income

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posted on Mar, 27 2005 @ 11:54 PM
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Ebay sales may be considered taxable income by the IRS. Last year $34 billion dollars worth of merchandise was sold on ebay. The question is, what is taxable and what isn't? The IRS considers any income taxable including bribes, gambling and even money made illegally are all taxable. The difference is if your making a profit or not, anything you make a profit on is taxable, but old used items that your selling for less then you paid, are not taxable.
 



news.yahoo.com
Hawking baby and children's clothes — along with some garage sale and thrift store bargains — on eBay helps Sunni Wojnarowsky bring in some extra money so she can afford to stay home with her two young boys. The additional dollars are great, but does she really need to hassle with the paperwork and report her small profit to the Internal Revenue Service? Her question, posed to the online auction site's discussion board for sellers, generated much advice — and more confusion.

In tax law, there is no clear, bright line that separates fun from profit, or a hobby from a business. But IRS instructions make it clear that all income — a category that includes bribes, gambling winnings, kickbacks and money made in illegal activities — can be taxed.




Please visit the link provided for the complete story.


The IRS is always taking more money from the people. Today in the US people are struggling to make ends meet. The IRS has stolen our money long enough and the government uses it to deceive and manipulate us. When will you people wake up and take America back? The IRS is unconstitutional and illegal, the 16th Amendment has never been ratified.

Related News Links:
www.bigbooster.com
www.anti-irs.com
www.apfn.org




posted on Mar, 28 2005 @ 12:21 AM
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Only things certain in life are death and taxes. Unreal how they want to double tax a product. It was already taxed on original purchase. What a scam.



posted on Mar, 28 2005 @ 12:58 AM
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I dont like the idea of paying taxes on things like this, but you have to admit its not really fair when people who make thier living selling things over ebay dont have to pay tax like someone who has a "normal" job would. I dont think the IRS is going to be tracking down people who sell a pair of headphones over ebay and make 25 dollars, theyre most likely aiming at people who are making $50,000/year untaxed through ebay sales, which i think is entirely fair. If youre using it as your source of income, you should have to pay Income Tax.



posted on Mar, 28 2005 @ 01:09 AM
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Don't they get enough already? We get taxed enough...IRS is such bull#. It's just greed on another level.



posted on Mar, 28 2005 @ 01:17 AM
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This became apparent to me I think last year during the election,... I think it was Cheney, who spoke of all the people making a living using online auctions, something that had not been true a few years prior, and not being counted in the unemployment figures.
Cheney: Economic Stats Miss EBay Sales

I immediately recognized this as indicating to me the government has set their eye's on a yet to be tapped revenue source. Looks like it was true.



posted on Mar, 28 2005 @ 01:46 AM
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Right they saw that 34 billion dollars worth of sales and want to take a third of your profits.



posted on Mar, 28 2005 @ 03:13 AM
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Originally posted by infinite8
Only things certain in life are death and taxes. Unreal how they want to double tax a product. It was already taxed on original purchase. What a scam.


It is such cliches that trap people into inevitable bondage.

The actual fact is that taxes are unnecessary restraints upon trade, and the wrong side of compound interest that government has trapped itself and its citizens.

Just the current Comprehensive Annual Financial Reports show most of us, and our governments Federal, State and Local to be entirely solvent.

If taxes are "inevitable," as "death," then it is only because people trap themselves with such cliches. Sorry but we have all been sold out, by a few elites who operate with impunity out of reach and out of touch from the common good.



posted on Mar, 28 2005 @ 03:55 AM
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It's kind of funny how government folks look a new trends where there's cash flow happening and just automatically assumes they're somehow not getting enough of their share & they need to create a new tax. Just how much are they making off the phone lines & data lines & ISP taxes these days. How many times or ways can they tax us for the same goddamn copper pair.

Yeah, I know this thread is about income tax of ebay sales, but it all boils down to how much money they steal from us and all the different schemes they come up with to do it. Not to mention the fact that they can't even account for what they do with the money we give them.

So, the IRS is going to go after the old ladies that spend $50 at garage sales on weekends and sell the stuff on ebay so they can make an extra $100 or $200 bucks a month. I think those are probably the only folks who are not declaring their ebay sales as income and I'm sure even some of them are.

Bottom line is as long as people are seeing the government wasting our money or taking too much, some people are always going to cheat a little when there's no way for the to government goons to account for it. If they try to force ebay to regulate it Ebay will disappear.

I've sold a few dozen things on Ebay & I don't recall (B. Clinton line) selling any for more than I paid originally. Some were things I had purchased to clutter/decorate my house, but I'd grown tired of them and they had been stored in my basement or attic for the past 10+ years, so I decided to get rid of them, because unlike garage sales you can actually get something for things on ebay if you find the right buyer.

I paid income taxes on the money I made before I purchased the items. I refuse to pay income taxes again when recovering monies that I already paid income tax on once.

The other items I sold were old or used computer items & all sold for less than what I originally obtained them for so in reality I took a loss on those items. But because they're part of my business they do count in my overall income whether they bring it up or down and that does go on my tax form.

Truth is there's more good deals on Ebay then there are money making opportunities there. I bought a brand new amplifier sealed in the box for $600 - that same model was selling at my local high end hi-fi store for $2500

There's not that many folks making a living selling things on ebay maybe a few thousand at most (I could be wrong) and I'm sure most people that are making a living at internet sales whether it's on ebay or their own company web site pays income taxes like everyone else.

The only folks with a valid complaint not getting all the possible taxes are the states who charge a sales tax and when the people in that state buy a product on the internet from another state & dont pay sales tax on it - the state loses out on that tax. At least that's the states argument which I half agree with. Problem I have is it's the consumers responsibility to send a check to your Department of Revenue if you buy something out of state, but since they can't enfoce that & so many people are cheating they are trying to shift the responsibility to out of state businesses.

The states are trying to make a law to require Ebay sellers to collect taxes for them but that would be a nightmare for sellers having to keep 50 seperate tax accounts/ledgers and write 50 different checks every month or quarter to each state. By the time you did all your paperwork or hired someone else to do it there wouldn't be any profit and you might as well close up shop. That's how govenment shoots themselves in the foot by putting small business out of business. The government gets too greedy & instead of getting some tax revenue they end up getting nothing when the business is gone. BTW-your required to collect tax for sales where the buyer is in your state if your state has sales tax. I spend at least a full day a year doing my state B & O tax & sales taxes even sales in different counties have different tax rates - I can't imagine spending two monthe of my time doing it for all states If I was making a living selling on the internet.

Other idea they have is that the states want to force Ebay to pay all the sales taxes to the states. Again if that happens someone will open an Ebay type place in a foreign country and ebay will go out of business. Then the states & the IRS will get even less revenues since the job losses created by the government by trying to overregulate a US business backfired. And everyone blames greedy companies for outsourcing their workers to make bigger profits - bottom line is our government overregulates them to the point in order to make a profit they move part of their business outside of our country to get around that overregulation. Now their talking about punishing companies further who are outsourcing, but they just don't get that those companies will completely go away if they don't stop this tax maddness often disquised in the form of tax regulations.


[edit on 28-3-2005 by outsider]



posted on Mar, 28 2005 @ 06:07 AM
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"The states are trying to make a law to require Ebay sellers to collect taxes for them but that would be a nightmare for sellers having to keep 50 seperate tax accounts/ledgers and write 50 different checks every month or quarter to each state. By the time you did all your paperwork or hired someone else to do it there wouldn't be any profit and you might as well close up shop. That's how govenment shoots themselves in the foot by putting small business out of business they get too greedy & instead of getting a some they end up getting nothing when the business is gone. BTW-your required to collect tax for sales where the buyer is in your state if your state has sales tax & I do as I'm sure most others do too. "
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Well, they've about killed the internet sale of cigarettes. Wonder what kind of revenue that little on-line market was bringing in?

NOw, they are in the process of killing E-bay??

Then they'll pick another little bit of the pot to regulate and tax....and kill it,

Why do I get the feeling that it's not the taxes they want, it's to kill the new businesses that are popping up everday online, which there are alot of the little guys making some pretty good money with...

Must be killing them, so many people saying goodbye to those low paying jobs and opting to find another means of survival.

Okay, I'll try to consider that maybe they reallly just want the tax money from the sales.

Well, why not take a more logical approach to the problem.

A federal internet sales tax, set a little higher than the average state sales tax. Which, the federal government administrates and the cost is taken from the revenue taken in. the remaining revenue is split fairly between the states.

The tax might be a little higher than what most state collect on the sales from their states, but that's okay, since you want the people to have the incentive of getting out of the house, walking around the mall, and visiting those brick and mortor shope that actually pay you property taxes.

And, well, the amount the states recieve might be a little less than they're used to, but it does seem to be better than nothing, isn't it?

Of course, I agree with many of the other posters......they need to stop thinking that there's a giant money tree growing outside the capitol building and curb in the unnecesary expenses otherwise, they are gonna lose their tax base...



posted on Mar, 28 2005 @ 06:28 AM
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Okay, I'll try to consider that maybe they reallly just want the tax money from the sales.

Well, why not take a more logical approach to the problem.

A federal internet sales tax, set a little higher than the average state sales tax. Which, the federal government administrates and the cost is taken from the revenue taken in. the remaining revenue is split fairly between the states.

The tax might be a little higher than what most state collect on the sales from their states, but that's okay, since you want the people to have the incentive of getting out of the house, walking around the mall, and visiting those brick and mortor shope that actually pay you property taxes.



I think it's just a matter of the states are always overbudget & always looking to plug up what they see as holes in their revenue stream that they believe they should be collecting instead of considering cutting the fat from their budgets. One thing they fail to understand is that people wouldn't be buying from an untaxed source on the internet if they didn't feel they were being overtaxed. Just because you find a way to tax that hole doesn't mean revenue will continue from that source - where theres a will to get around taxes people will find another way to dodge those taxes.

While your idea is the most plausible & at first seems better than forcing ebay & other companies to hire the accountants & programmers to do the extra work, now your asking us to pay for more government because you have to create another government agency to oversee the collection & distribution of those funds. So we end up with more regulation & bigger government & the monies collected get watered down even more just passing through more govenment hands. Personally I think we'd get more bang for the buck having Ebay hire an accountant than having the government hire 3 people to do the same amount of work.

Nope - I think the best chance they have is getting ebay to automate most of it through the software so that it happens automatically during the sale just like the fees they charge are automatically deducted by the software when you make a sale. But, that would take years to develop and there would have to be alot of bickering about how it would be paid for. Still that would open the door for out of country auctionhouses to prosper & take Ebays biz.


[edit on 28-3-2005 by outsider]



posted on Mar, 28 2005 @ 07:18 AM
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"While your idea is the most plausible & at first seems better than forcing ebay & other companies to hire the accountants & programmers to do the extra work, now your asking us to pay for more government because you have to create another government agency to oversee the collection & distribution of those funds. So we end up with more regulation & bigger government & the monies collected get watered down even more just passing through more govenment hands. Personally I think we'd get more bang for the buck having Ebay hire an accountant than having the government hire 3 people to do the same amount of work. "
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What we don't want to do is kill the business. I'm sure that Ebay would have the resources to develope the programming and hire the accountants to figure out exactly how much they owe each state in collected sales tax (shall we worry about county and city sales tax also?) But well, there are alot of businesses online that don't have those resources, and no one is going to want to go through that kind of hassle.
Which is the only reason why I bring in the federal government. If they had one office to send one tax rate to, then it is feasible, otherwise, forget it.....
As far as your concerns, well, that ties back into what I said about that great money tree, that isn't growing outside the capitol building, regardless of how delusional it's occupants seem to be. If they don't seriously sit down and take a look at where their money is going and cut out all this unnecessary crap, the money they get from another sales tax won't help anyways, and it will do more harm if they try to lay this in the laps of the on line businesses.



posted on Mar, 28 2005 @ 11:44 AM
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Please, people, read the article before you put your foots in your mouths.

No, in most cases, there was no tax paid at the point of purchase. And tax paid at the point of purchase is sales tax, anyway - this article is talking about income tax. Charging sales tax on eBay sales is yet another issue, but not the one talked about in this article, nor one that the IRS has any say or interest in.

They are primarily targeting people who operate small businesses buying merchandise wholesale and selling it on eBay. These people do not (or should not, if they are aware of the tax laws) pay sales tax on the purchase of these goods.

This is a large, untaxed underground economy which is growing larger. I commend the IRS for addressing this issue. The fact is, these people are stealing from you and me, making OUR taxes higher as a result.

As an aside, I'd have to say that my biggest disappointment with eBay is that it has become something that I don't think it was ever intended to be. Rather than a place to clear out our attic, it is an additional profit center for discount merchants. The size of these merchants varies from the largest (IBM, Dell) to the smallest (somebody's grandma who spotted a kit-cat clock at a garage sale for $1 and is selling it for $100 on eBay.

(If you really are interested in clearing out your attic, you may find craigslist.com a more appropriate venue.)

The fact is, though, profit is profit, and our system is set up to tax profits. If you don't like it, work to change the system, and find some other way to fund goverment, and/or reduce the size of government. The way to do it isn't by cheating the rest of us and forcing us to pay more taxes, though. The problem is, just where do you draw the line? I suspect there are some rather large merchants that are doing their eBay sales "off the books", as well as mom-and-pop operations that have grown to considerable size and that people derive their entire and substantial incomes from.

These people should pay their share, just like the rest of us, most of whom have no choice in the matter.

[edit on 28-3-2005 by Bay_Watcher]

[edit on 28-3-2005 by Bay_Watcher]



posted on Mar, 28 2005 @ 12:05 PM
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well said Bay Watcher.

I've been saying it for years, the gov't should slap a one cent tax on all internet sales, regardless of size. nobody would care and the money would pile up and they can then go and piss that money away on some such wastefull things as congressional hearings on steroid use in baseball



posted on Mar, 28 2005 @ 04:02 PM
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Originally posted by Bay_Watcher
Please, people, read the article before you put your foots in your mouths.

this article is talking about income tax.

Charging sales tax on eBay sales is yet another issue, but not the one talked about in this article, nor one that the IRS has any say or interest in.



So are you the thread police and are you going to tells us what we can and can't discuss in a thread that you didn't even start. I think we can expand the thread that begins with an article about IRS taxes to other taxes or related issues without your permission.

Maybe you should read what I wrote before you start putting your foot in your mouth. While the article that began this thread may have been about income tax the thread has expanded about all taxes - though tax collecting folks like to ignore the fact that there are other taxes. REALITY tells us all of the taxes effect the bottom line of what we can purchase after all taxes are accounted for.


This is a large, untaxed underground economy which is growing larger. I commend the IRS for addressing this issue. The fact is, these people are stealing from you and me, making OUR taxes higher as a result.


An underground economy, gee I wonder what could have caused something like that too happen - if thats true. Spoken like a true bureaucrat - you try to turn the people against each other by telling us our neighbors stealing from us, when the only ones stealing the fruits of our labers are the bureaucrats themselves. You don't fool me and eventually everyone else will wake up to your game.


it is an additional profit center for discount merchants. The size of these merchants varies from the largest (IBM, Dell) to the smallest (somebody's grandma who spotted a kit-cat clock at a garage sale for $1 and is selling it for $100 on eBay.


So - what exactly is wrong with that. Most of them are paying taxes which seems to be your biggest concern.


(If you really are interested in clearing out your attic, you may find craigslist.com a more appropriate venue.)


Thanks, but no thanks I don't think we need you to tell us where we can sell our goods and where we can't.


If you don't like it, work to change the system, and find some other way to fund goverment, and/or reduce the size of government.


We are changing the system, otherwise we wouldn't be hearing so much whining from the IRS & folks like you.


[edit on 28-3-2005 by outsider]




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