1099 K From PayPal -

I’d contact PayPal directly (from their site not contact info on the email). seems a bit scamish to me, but I am not familiar with US taxes.

 

Subbed. No 1099 emails, but I’ve gotten some scam “PayPal account locked” emails lately. When logging in directly, everything was fine. I’ve changed my password a bunch this year, just in case.

I didn’t make a ton on PayPal this year, definitely spent more than earned, but I did have a few sales and gig payouts.

 

Great question. Now I’m self employed and all that crap goes through my account lol. I’ll check back if I learn/ see anything, but I’m in NY state so IDK if it’s different state to state. I’m actually meeting with him tomorrow, I’ll see what he says.

 

Agree....still seems odd

 

Because they're required to by law. You then have to "fill in details" in your tax return. Ugh. They just keep making tax life more difficult.

 

Actually it looks like you understand it perfectly.

Sold goods aren't taxable as income if you are selling a used personal item for less than the original value.

 

I used to 1099 my gig earnings as that was my job. Taxable amounts and such were included in the booklet you’d get with the forms. That was in NY. Nowadays, my accountant does it for me. I would assume the old booklets are now PDFs. Each state would have its own set of tax rules and federal is the same across the board.
Don’t forget to save all original supporting docs for 7-10 years jic

 

3rd party payment processors (i.e. PayPal) may produce a 1099-K if you received gross payments > $20,000 and 200 or more transactions. It does not necessarily mean you owe taxes on any of the proceeds, just that you might owe taxes on the proceeds. The volume and amount signals to the IRS that you might be operating as a business. 1099-K is reported on Schedule C. You'll have to do some research or talk to a tax expert on how to handle. Pretty certain if the IRS doesn't see a matching amount somewhere on your return, they'll send you a notice of unreported income.

 

Pretty soon, all states will be doing this and they're hoping that you don't look into it and just pay the tax. IANAL, and maybe different states do things differently, but if you sell a personal item for less than you paid for it, you don't need to pay tax on the amount you received. We're getting close to the point that it might be better to just sell it to Guitar Center.

 

I got one too, I ignored since I only received one payment and it wasn’t much. Now me spending money is a whole nother thing lol

 

Just hope it doesn't mean that I have to use the next version up of Turbo Tax for small business to file that and say that it does not apply. Looks like Maryland enacted it too. Basically they're trying to tell small businesses - we see you. And get some free money from people that will just pay.

 

PayPal is reporting to the IRS where their funds went.
They're simply denoting transactions and movement of funds, like an employer reports your income to the IRS. Your tax liability is completely dependent on your personal situation.
Whether you owe short, or long term capital gains tax on these transactions is dependent on your basis in said items, and how long you owned them.
Go to IRS.gov and search for publications on capital gains and 1099k reporting. It's in PDF form, and they're usually very explanatory.

 

Happens when you take too much in via PayPal. I got this when I had an eBay business. Just one of those things.

 

The value was given to you, as long as it's under the gift tax limit, it's yours. I used to be straight-laced on taxes until something happened that I can't talk about due to forum rules. If there are gray areas, I'm not paying it.