[Whitigir]

Agree. Friends and Family transactions between trusted head-fiers avoids the mess.

Apparently, head fi still keep the old rules and regulations that any listings that only ask for Friend and Family will be deleted

Oh and this new tax requirement has no effect people selling used gear at a loss....So really it's not even worth stressing over.

According to the IRS explanation, only business can write off the depreciated assets. If it is personal items, you can not write that off as a deductible, and hence you still have to pick up that stick As an income

 

[DenverW]

Apparently, head fi still keep the old rules and regulations that any listings that only ask for Friend and Family will be deleted

According to the IRS explanation, only business can write off the depreciated assets. If it is personal items, you can not write that off as a deductible, and hence you still have to pick up that stick As an income

To my understanding the ‘income’ would be the profit made from the sale of the used item, not the amount of the sale. Do you have anything I could look at that states it’s based only on the sale?

There is no taxable income made from selling used goods at a loss. If someone on headfi made a profit from selling an item that appreciated in value then that is expected to be taxed.

 

[dougq]

To my understanding the ‘income’ would be the profit made from the sale of the used item, not the amount of the sale. Do you have anything I could look at that states it’s based only on the sale?

There is no taxable income made from selling used goods at a loss. If someone on headfi made a profit from selling an item that appreciated in value then that is expected to be taxed.

You are absolutely correct. It's the equivalent of selling items at a garage sale. None of it is income and should not be reported as such.

 

[HiFiHawaii808]

You are absolutely correct. It's the equivalent of selling items at a garage sale. None of it is income and should not be reported as such.

Paypal will send a 1099 to the IRS which is the amount of the proceeds a person receives from the sales of goods and services. That is a revenue line. If you want to avoid an audit, you have to report a schedule that has that amount or more reported on your return. Usually, it happens on a schedule D like the sale of a stock or bond. Or, schedule C if it is associated with a business. It's not that hard. There is absolutely no way that people are required to pay taxes on revenue without being able to deduct either the tax basis for that asset or any costs associated with the product.

 

[donkeywalker]

For those who're not following closely, the IRS has decided to not to do this for tax year 2022, and it caused too much confusion, instead it will become effective 2023 https://www.irs.gov/newsroom/irs-an...or-third-party-payment-platforms-forms-1099-k

 

[dougq]

And again it wouldn’t impact anyone because it’s selling a used good at a loss.

 

[thehutch]

And again it wouldn’t impact anyone because it’s selling a used good at a loss.

Do it a few years in a row and you could get audited.

 

[dougq]

Do it a few years in a row and you could get audited.

You can get audited every year. No one knows that this makes it more likely. Just guessing.

 

[Ivabign]

Paying attention to what things cost and what we end up selling items for - taking into account shipping and fees - smart money is on getting a bigger refund. Buyers and sellers of personal audio equipment are small fish - not audit targets.

 

[Whitigir]

Paying attention to what things cost and what we end up selling items for - taking into account shipping and fees - smart money is on getting a bigger refund. Buyers and sellers of personal audio equipment are small fish - not audit targets.

You haven’t seen people who cycle through many gears a year, and of an average 3-5k a piece. If it was a small fish, then the $600 would have not been imposed. The way people cycle their high end gears could easily reach 25-30k a year, but that doesn’t mean they spent all that. They just sold what they had and put in a little more for new gear. Likely spending 3-5k additional to the original investment.

 

[DenverW]

As expected, this change has been delayed again according to MSN, and people under 20k will not receive a 1099-r. Of note, the article says that in the upcoming year they've adjusted it to 5k in sales, as opposed to $600.

Very nice to hear. I had a guy earlier this year who wanted to charge an additional fee (in addition to the paypal G&S fee) if you didn't want to use F&F, because he was 'inconvenienced.'

https://www.msn.com/en-us/money/per... aggregate above $20,000 will remain in place.

 

[Whitigir]

As expected, this change has been delayed again according to MSN, and people under 20k will not receive a 1099-r. Of note, the article says that in the upcoming year they've adjusted it to 5k in sales, as opposed to $600.

Very nice to hear. I had a guy earlier this year who wanted to charge an additional fee (in addition to the paypal G&S fee) if you didn't want to use F&F, because he was 'inconvenienced.'

https://www.msn.com/en-us/money/personalfinance/irs-delays-tax-reporting-rule-change-for-business-payments-on-apps-such-as-venmo-and-paypal/ar-AA1kjwT7#:~:text=If you received business payments via apps such,an aggregate above $20,000 will remain in place.

Even with $5k marks, I fill up my gas tanks for commute more than that within a year

 

[SCBob]

Not sure what your cost of gas has to do with PayPal IRS tax reporting requirements.

 

[DenverW]

Even with $5k marks, I fill up my gas tanks for commute more than that within a year

I'm sure there are people that will, especially if they're members of the trade, or ticket in large items. It's more of a buffer for myself, and the positive of another year not worrying about it. I wonder if next year will be another year without seeing this as well...

 

[thehutch]

As expected, this change has been delayed again according to MSN, and people under 20k will not receive a 1099-r. Of note, the article says that in the upcoming year they've adjusted it to 5k in sales, as opposed to $600.

Very nice to hear. I had a guy earlier this year who wanted to charge an additional fee (in addition to the paypal G&S fee) if you didn't want to use F&F, because he was 'inconvenienced.'

https://www.msn.com/en-us/money/personalfinance/irs-delays-tax-reporting-rule-change-for-business-payments-on-apps-such-as-venmo-and-paypal/ar-AA1kjwT7#:~:text=If you received business payments via apps such,an aggregate above $20,000 will remain in place.

That’s good news