1099-K taxes - facts, fiction, and the future of G&S payments

[estin]

The only upside I can see from these changes is possibly less online scams and fraud. Can you imagine a scammer getting a 1099 because they collected over $600 in fraud/scams during the year? LOL

[jincay]

Oh dear the youth of today will have to wait for the money order to arrive, no more instant shipping

[Savet]

You will want to save a copy of the transaction for when you bought it and when you sold it. That way if you get audited you will be able to prove that there wasn't a profit.

Not only that, but the loss offsets profit you might make on another transaction. I would suspect that people fit very nearly into one of two camps. Either they're really a hobbyist and their transactions will roughly cancel, or they've been avoiding income tax on actual income and are now going to need to start claiming it.

[estin]

^ think they know what one is? maybe COD makes a comeback. lol

[estin]

Not only that, but the loss offsets profit you might make on another transaction. I would suspect that people fit very nearly into one of two camps. Either they're really a hobbyist and their transactions will roughly cancel, or they've been avoiding income tax on actual income and are now going to need to start claiming it.

does this automatically lump everyone into a hobbyist business? how does that work for most of us who buy/sell/trade at a constant loss? lol

[Savet]

does this automatically lump everyone into a hobbyist business? how does that work for most of us who buy/sell/trade at a constant loss? lol

Again, I'm not a tax professional, but I definitely would lump everything together. It's a really simple 4-column spreadsheet:

Item	Purchase Price	Sell Price	Net Profit/Loss
Widget 1	1000	900	-100
Widget 2	780	850	70
Totals	1780	1750	-30

The issue of concern is that you are getting paid by somebody, but you're only responsible for paying taxes on your actual income, which would be the net column.

[pearcem]

Not a tax expert or advisor, but is there any reason you couldn't claim the income under alternative investments? That's where people usually park collectibles, etc.

You would still need to have the documentation to back up, item by item, purchase price, sale price, and transaction dates, but then you would be treating the transactions as capital gains, or more likely in the BST here, losses.

[mercpb]

There's many ways one might characterize the transactions --- business, hobby, investment perhaps ----

I think the key practical pain point coming for most is, they have, and keep, no receipts. And without receipts you can't prove cost basis if it comes to it.

[Chuck E Ducky]

Can I just take a picture of my collection and tell the to F off…

[estin]

There's many ways one might characterize the transactions --- business, hobby, investment perhaps ----

I think the key practical pain point coming for most is, they have, and keep, no receipts. And without receipts you can't prove cost basis if it comes to it.

this alone is going to be a nightmare. how many teenagers or early 20's somethings on PBN or wherever are going to get a 1099 next January for thousands of dollars and have no clue. I mean you buy one high end marker and sell for $1500, roll that money into the next marker and then sell that for $1200, buy the next one and sell that for $1000, etc... all a sudden you are 16 years old and getting a 1099 for $10K LOL

[Grendel]

This would be a fruitful lesson in real world finances

[mercpb]

Potentially HUGE --- the suits will have millions of people with documented under-reported income and no clue what's going on. If they decide to aggressively enforce it'll be fish in a barrel. OR they don't enforce and it's a big nothingburger.

Popcorn ready!

[flyweightnate]

... and they do tend to focus enforcement on those with the least resources to contest.

What constitutes a "receipt"? A PayPal record sufficient?

[maninblack2k]

Are there any updates to this from your original post that your aware of?

[Cunha]

Everyone is waiting for 2023 when we all get the tax documents from paypal and ebay and stuff.

[maninblack2k]

All- I just saw this today. A nice pause for a year at least.

IRS Halts Controversial New Rule Requiring Gig Workers To Report $600 Payments (msn.com)

[mercpb]

added a few updates to 1st post

Man it's rough out there ---- ask people about check/money order as an option and they think your the taliban or something.

Guys I have WAY BETTER feedback than the taliban.
I think...