1099 from Paypal??

fess

Senior Member
I sold some drums in June for $950. Just got a 1099 from Paypal showing it as income. That's never happened before and I cetainly didn't make a profit. Anyone else get one?
 

MrInsanePolack

Platinum Member
Internet sales are now taxable. I believe it went into effect about 6-8 months ago. Uncle Sam wants his cut. My guess is $$$ transfer sites like PayPal now must disclose all transactions to the feds. It's becoming bank like. Cant wait till my netspend card starts getting taxed too 🙁.
 

C.M. Jones

Well-known member
I'm no accountant, but if PayPal sent you a 1099, the IRS will receive a copy as well. If you fail to file the documented sum, the IRS might catch the discrepancy and mail you a letter demanding immediate payment, perhaps with penalties. Punitive communications from the IRS are better off avoided.

If you believe PayPal has sent the 1099 in error, contact them and request clarification, but don't ignore the 1099 when filing taxes.
 
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drumnut87

Well-known member
no idea sorry, seems to be a US thing, twitch streamers have been reporting getting the same forms as well.
 

Rotarded

Senior Member
I got one. I sold over $20K in retired computer equipment for my boss's LLC, but about $3k in drum equip. Was surprised to get that notification. Gotta love the IRS....
 

drumnut87

Well-known member
damn, that sucks
 

Smoke

Silver Member
I never did understand the "income" thing. Sell a drum for $$$ - it's not income, it was a trade. I had a drum, but now I've got cash instead. Same as your day job. Trade time and skills for $$$. No income there. The boss and I agreed to a certain wage for a day's labor. My investments increase in value over my basis - that's income. Does the guy/gal get a tax write-off because they now have a drum but no money? I'll bet not.
 

GetAgrippa

Platinum Member
Just talked to payPal. Seems now if you live in Virginia, they consider any PayPal income over $600 as taxable and they need to report it. So, if I sell a drum for over 600, I'm supposed to pay income tax on the sale.
So sell the drums in two parts so the "sale" is always under 600 bucks is what I'd do. A wink and nod-oh you want to by my $1,200 Renown-well wink wink-so it comes as is with snare, bass drum, and a tom but there are tom and hardware upgrade you can buy if interested later- wink, wink.So you sell it in two parts-divide and conquer.
 

wraub

Well-known member
Just got my "relief payment" on a debit card instead of a check, so I can not say anything good here at all.
 

bud7h4

Silver Member
If you're going to tax me for an internet sale because it's "income", then where was my "business expense" deduction when I originally bought the thing?
What they're doing is taxing internet use.
 
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MntnMan62

Junior Member
I sold some drums in June for $950. Just got a 1099 from Paypal showing it as income. That's never happened before and I cetainly didn't make a profit. Anyone else get one?

What you need to do is offset that income with some evidence of what you paid for the drums. It doesn't need to be much but at least something. You shouldn't have to pay income tax on something that you paid more for than you sold it for.
 

Push pull stroke

Platinum Member
If you're going to tax me for an internet sale because it's "income", then where was my "business expense" deduction when I originally bought the thing?
What they're doing is taxing internet use.

Yeah, they’re just going to drive people from eBay to Craigslist, Facebook marketplace, etc.. Total amount of used item sales online won’t change, it will just hurt eBay and help Craigslist. The end.
 

No Way Jose

Silver Member
I'm not sure there is a problem here. We are allowed to sell personal property. Some people are operating a business and selling on websites. I imagine it is these ghost businesses that the IRS (IRS is the USA tax collector) is concerned about.
 

Stroman

Platinum Member
I'm not sure there is a problem here. We are allowed to sell personal property. Some people are operating a business and selling on websites. I imagine it is these ghost businesses that the IRS (IRS is the USA tax collector) is concerned about.
That's probably true, but in no economics model would the selling price be the actual income for a business. The income would be the profit a business makes (sales - costs = profit).

This seems totally wrong to me. Now the onus is on Joe Blow to enumerate his expenses and possibly pay a tax preparer to avoid paying an unfair tax.

(For the record, I work in a financial institution, and a lot of the things I see people worry about are needless concerns, IMO, but this truly sucks.)
 

felonious69

Well-known member
So if you bought a drum set for 1000. Sell it a couple years later for 800. Isn't that a loss you should be able to write off?
You buy a set for 1000. Upgrade it at a COST to you of 300. Sell it for 1500, should that be an "income" of 200?

Meanwhile rich elitists pay next to nothing, yet I can't write off the gas I am required to buy to fill my car to allow me to get to my job, the insurance I am required to have to operate it, the maintenance costs to keep it working.
 
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