Guess What, eBay Sellers ...

This is no surprise. This is added to a bill that it has nothing in common with. And to think we elect the jerks who do this under our own noses.

Don't sell stuff but good to know.

Thanks for the info. I got out of selling on Ebay due to way too many Ebay/user issues. I was considering starting again(I guess I've forgotten how horrible it was before?), so this info is good to know, thanks.

We are small potatoes trying to earn a living and the government can't give us a break.

Well, by 2011 we can all have an alternative if we don't want to pay called sell for cash on Craig's List.

Government is cracking down on the little guys.

Ebay/Paypal have already destroyed & eliminated so many small sellers with their INSANE new policies of MANDATING many sellers to offer Paypal, then withholding many sellers funds for 21 plus days, by dictating a new policy which FORCES sellers to LIE about bad buyers, by charging sellers to list some items which ebay does NOT disclose will NEVER show up in searches, by burying listings deep in ebay's default "Best Matches" searches where buyers have little to no chance of finding those items, by throwing away all but the last 12 months of sellers feedback percentages, by raising their prices to the detriment of all of it's users, by promoting shill bidding by hiding bidders' IDs, by promoting scamming buyers activities by only allowing 100% positive feedback to be posted for them and giving NO WARNING about thosebuyers previous abuses to future sellers, by Paypal FORCING some buyers to mail their suspected counterfeit items (bought on ebay) to "Liquidity Services" which is a selling venue (not a authenticator of designer items nor a facility for destroying counterfeit merchandise), by gifting such entities as buy.com free or nearly free listings to compete against honest, full-fee paying, long standing ebay sellers...to name just a few of the irrational policies killing ebay users.

With ebay/Paypal's plans to implement even more policies (designed to ruin more ebayers in coming months), those currently attempting to make their monies through ebay, will be LONG GONE BEFORE the government's new provision is in effect.

Let's see...ebay is pushing sellers to offer "Free Shipping", so ebay can receive more revenues by charging sellers fees, which includes the amount the seller pays for shipping. Paypal (owned by ebay) fees are already based on the entire amount, including the shipping price. Now, the government will be taxing the small sellers on the total price, including the amount which sellers pay to ship items.

All of this WHILE ebay evades many government regulations by CLAIMING to be "just a venue" and WHILE claiming Paypal is "not a bank".

'Looks to me like the government is "barking up the wrong tree". How about actually forcing ebay & Paypal to comply with government regulations and taxing ebay/Paypal as the entities they truly ARE, rather than what they "claim" to be?

I guess that settles it. I don't want to sell some of my crap on Ebay. I haven't sold anything in a couple years.. guess I won't try again. Doesn't seem like there'd be any point.. and possibly I'd be paying to sell my crap.. and get nothing for it. Hmm no thanks Ebay.

The government wants its taxes ... and has a right to them. While many are selling new items on eBay, I feel sorry for those who are using it to downsize and will be struck with the recordkeeping. It seems overkill to have to document "net profit" in those circumstances. As this tracking will happen through online payment systems, it could affect affect anything not done with cash ... what a pain.

I've never sold anything on e-Bay and the world ends in 2012, so this should have minimal effect.

This is not something newly invented by the government. We sell on Ebay and have always had to report the gross sales we earn there. However, we legitimately deduct all costs of a sale, including fees paid to Ebay and Paypal, as well as the original cost of the item and any repair costs that may have been needed to make the item salable. Ebay and Paypal provide an excellent paper trail for each transaction which allows us to maintain meticulous records. It’s just business. It's the way one conducts a business. If anyone is grossing $10,000 a year or more on-line, there is no room for complaint, because, like it or not, that person or entity is running a business on the internet and should not be exempt from paying the applicable taxes just like the rest of us. If you are selling your personal possessions or household goods, you will likely to be receiving less than you originally paid for these items and would not be making a profit so you would not owe taxes if you are showing a loss. Check with an accountant as to the best way to liquidate your assets so that you will not incur a tax obligation. Perhaps you could sell 200 items at the end of one year and 200 items at the beginning of the next. Sell the rest of your goods in a garage sale and give what is left over to charity. You can even take a deduction for items given to charity if you get a receipt that shows an estimated resale value of those items. Selling on Ebay is not a special entitlement for “the little guy.” Little guys benefit more than most from local, state and federal government programs, so it is only just that we all pay our fair share into these systems. This is how money flows into the general fund, which in turn pays for all the social entitlements many “little guys” receive.

Thank you Natalie for a careful, and complete seller perspective.

If someone is doing a eBay business, business proceeds are taxable. I am sure the Housing and Economic Recovery Act of 2008 provision was designed to help catch those who were attempting to run a business on the side, evading the taxman, and the government has a right to arm itself for enforcement.

My concerns are two: 1) 200 transactions seems a low threshold if, in example, someone is downsizing -- the recordkeeping needed to "prove" that items are not being sold for profit would be quite a burden, and 2) it concerns me that this "taxation" provision is part of a "mortgage and real estate incentive" bill, which is an odd fit.

While I haven't personally sold on eBay, it does make me plan to keep receipts for items I might recycle through something like eBay later so I have the requisite proof.

They should also keep track of their cost of the items they are selling. So if they make $10,000 in sales but only $2000 of that is profit, they will get to deduct the cost of the inventory to them.

If someone uses a standard accounting software, that is called "cost of goods sold", and includes not only the cost of the items, but also the cost to procure and market them. It is easy to document if you buy inventory for the purpose of sale. It is harder if you want to sell an item you've owned for a while.

Well you knew they had to get their fingers in the e-trade somehow!!!! LOL

I don't use ebay at all.

Uh oh! I'm not sure what I feel about this one.

Thanks for sharing this information.