You're The Dealer - What's Fair?

BiggFredd, I thought you got an additional tax form when you have more than 20 grand in sales through ebay and pay-pal, is this not accurate?

So if you live in NY and you buy $1001 worth of bullion, you don't pay any tax on it? Or is it only taxed on the 1st $1000 worth?

Thanks to mmorgan22 for the link to the state tax laws on PM coins and bullion. Using that I was able to go to a link that specifically lists the code for my state. Very helpful and much appreciated!

The only thing I can think of is something like a 1099 (which would also go to the IRS) telling you how much you sold. Since the IRS assumes zero cost, it's up to you to have records showing that you paid $17,000 (or whatever), or you'll owe taxes on $20,000 income instead of $3000 profit.

Aside from that piece of paper, if you make a profit buying and selling, you owe taxes on that profit. You can also deduct expenses like mileage, postage, computer costs related to your biz, show admission, etc.

The $20K thing is the IRS cracking down. If they're told you sold $20,000 on ebay and you report $30,000 in sales, they'll prolly move on. If you report $10,000, or worse nothing, there will be questions asked.

Yes I will end up making 15 grand this year at my part time bar-tending gig, and that is BEFORE taxes. I have sold right at 15 grand on ebay....

So does that mean I need to be taxed on 30 grand?

Of the 15 and one half grand on ebay this year, I know I have at least 8 grand of my own money tied up in pay-pal fees, ebay, shipping, and shelf stock an Pm's. I do have all transactions on file in my comp, bought or sold. So another words if I can prove I made only an extra 7 grand on ebay, then I should just be taxed on 22 grand for the year, via 15 from my part time bar tending job and roughly a wild guess of 7 grand profit from ebay sells....

Does that sound right?

Also good to note TBK about that 200 transaction rule, as I have 122 transactions on ebay, and two more outside of it via you and Pobox for a total of 124, but that is in like the last 14 months....

ebay just updated my seller dashboard, and I am showing a 101 transactions in last 12 months, and now qualify in all categories for power seller statues, yet it says I am still not a power seller, lol. Who knows, maybe it will update later....

Accountant rof....

One of my best friends wife is an accountant, maybe I can pay her to help me out an do my taxes, as she has helped me with them in the past. I used to work at the company where she is the current head accountant, a film lab oddly enough which traps much gold an silver every quarter, and she is in charge of selling it when the market prices peak out....

Its all good, as I talked to her a little bit ago and she said I could bring my info down an she would run it when they do their taxes this year. Since I have payed in 2100 already via my check from work in taxes, and usually get back around a grand. She figures I still may break even or still get back a couple hundred.....

Hawk-

An accountant specializing in taxes will save you money versus second guessing.

That said, in principal, it's pretty easy:

Start with sales, subtract what you paid for what you sold* that's your gross profit. Add up expenses, phone calls, the share of your computer used for business, rent on lock box, mileage, seminars related to your biz, postage, etc.

Subtract expenses from gross profit to get net profit, which is taxable, like your bartender income.

*Some people mistakenly think it's all sales minus all purchases. This is only true if you sell everything you bought the year you bought it.

If you buy ten trains for $50 each and sell eight for $800, your profit is $400, not $300, because you still have $100 worth of trains left in inventory.