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I think I just got myself in a shit ton of trouble

Discussion in 'Ebay' started by tonyd2wild, Nov 6, 2013.

  1. tonyd2wild

    tonyd2wild Newbie

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    Hey yal I just would like to have some advice to if there is anything I can do if so let me know, if not let me know lol...
    I have a youtube channel where I sell many computer equipment overseas as well as sneakers from overseas (China) and I review them and some I keep and some people Is sell them to, some of the shoes are replicas and some are authentic. The people who know them buy them whether they are real or not so this is no fraud going on. But here is the thing, 90% of the transactions are done by "gifted" payments then they email me their address and I ship it to them. I usually gift the replicas and invoice the authentic, because invoice replica shoes is a automatic dispute and is against paypal policies. But the main reason I am writing this is because I just checked my Sales report and I have made over 22k I do not know how the hell I did that but I lost track of of it honestly. I heard now paypal reports this to the IRS if you have over 200 transactions and 20k which I am sure I have surpassed by now. So I want to know what is going to happen ? Am I going to get a IRS form from paypal to fill out and have to pay ? I have no problem taking care of my responsibilities but I just want to know what happens. Also even though I have had so many transactions via gifted (200 gifted transactions) will paypal report those as taxable ? I just got a call from them today and they told me the following:

    Thank you for using PayPal to accept payments. You can receive money from friends and family for personal payments within the US for free. Personal payments are for sending a gift, splitting a lunch bill, paying your share of the living expenses, and everyday exchanges of money between friends and family.


    If you receive money as a payment for a purchase or service, you will continue to incur fees.


    We've noticed that some customers are sending you personal payments for purchases of items or services.


    Unfortunately, this is against our policies, and we need your help correcting it. Please don't ask or allow your customers to use personal payments to pay for their purchases.


    If we continue to see such activity, we may have to disable your ability to receive free personal payments, and then you will pay fees for all money received through PayPal.

    So I am going to have to stop that way of payment now, so please help me guys if you can.


    Sales Activity 22,448.68
    Payments received 25,946.18
    Refunds sent -3,497.50
    Fees -259.21
    Payment fees -281.16
    Refunded fees* 91.03
    Chargeback fees 0.00
    Account Fees Invoice 0.00
    Other fees -69.08
    Dispute Activity -285.00
    Chargebacks & disputes -891.42
    Dispute reimbursements 606.42
    Transfers & Withdrawals 1,491.71
    Currency transfers 259.58
    Transfers to PayPal account 6,242.23
    Transfers from PayPal account -5,010.10
    Purchase Activity -23,142.74
    Online payments sent -10,771.75
    Refunds received 407.60
    Debit card purchases -12,778.59
    Debit card returns 0.00
    Reserves and releases 0.00
    Blocked Payments 0.00
    Other Activity -37.65
    Money market dividends 0.00
    Debit card cash back 0.00
    Credit card cash back 0.00
    Other -37.65
     
    Last edited: Nov 7, 2013
  2. bartosimpsonio

    bartosimpsonio Jr. VIP Jr. VIP Premium Member

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    You only got a warning. Doesn't seem like a shit ton of trouble to me.

    See 2checkout for an alternative to pp.
     
  3. tonyd2wild

    tonyd2wild Newbie

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    I understand that but what about the 22K I made this year off gifted payments? Is it going to be sent to the IRS ? Im 22 years old man this is alot of money to me. I know you guys on here make more. I just need to know is this 22k being sent to the IRS and will I be taxed this year I know I'm going to owe some thousands if so.
     
  4. gypsyr0ad

    gypsyr0ad Regular Member

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    Considering you seem to be doing pretty decently, why are you concerned with having to pay taxes?
    You cant possibly be too broke to pay the taxes, can you?

    I wouldn't really worry too much about the gifted payment thing, just stop doing it and run a legit business.

    Why do people ruin a good thing over greed?
    IDK
     
  5. tonyd2wild

    tonyd2wild Newbie

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    No guys I have the money to pay the taxes I saved my money and yes I will decide to be more legit with it. I just not familiar with all this Im a college student still being claimed as a dependent so it just came at me fast. I just do not know how much I will end up owing and all that I just wanted to know if I had anything to be worried about.. I have about 6k saved up and the rest in stocks and reinvestments. I just was just worried about it if by me doing gifted would it make the IRS start looking at me weird like how did I make all this money with no business license or job. Isn't that a red flag to them? I had a business license last year but this year I did not, a 22 year old student who made 22k this year would raise a flag to them? I made almost as much as my mother lol
     
  6. bartosimpsonio

    bartosimpsonio Jr. VIP Jr. VIP Premium Member

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    Everything you do via paypal is sent to the IRS....everything, whether it's a gift or a payment. Paypal may differentiate between those kinds of payment types, but the IRS doesn't, they watch every financial transaction.

    The good news is as of now you owe a few percent in taxes. If 7%, then you owe a little more than 1.5k u$.

    So if you confess up to the IRS before they come after you, you probably won't get a big fine. Just pay up and do your taxes, you won't ever be free from the taxman.

    On the other hand if you let the IRS find out without you confessing first, they'll rape your ass so wide you'll need more than the 22k to repair it.

    Black hat is NOT about fraud and tax evasion, it's about defeating search engine algos against their will....so tax evasion is definitely not black hat, it's only foolish.
     
  7. gypsyr0ad

    gypsyr0ad Regular Member

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    I wasn't trying to judge you and glad you do have the funds saved or else it could get ugly for you.

    Hopefully someone can provide the right answers for you here, if not, you should google and find out, its probably not that huge of a deal to be completely legit in the eyes of the Gov.

    My exboss runs 3 concession trailers all summer long and does not even claim one worker, he claims that he, his wife and daughter runs them, no clue how the hell he gets away with that shit, plus works underage girls 14 hrs a day and treats them like shit.

    But yah, if he can get away with that, I am sure you have nothing to worry about.
     
  8. spmcnerd

    spmcnerd Regular Member

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    You had me at "shit ton of trouble"
    Jackslap the briallint one who told you to run money full on bawls out in wind.


    I would claim good faith somwhere and avoid ignorance of the law excuses.


    Good luck STs
     
  9. tonyd2wild

    tonyd2wild Newbie

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    So when you mean I confess it, you mean just call up paypal and tell them that all this income I receive this year (2013) was not taxable(They probably are going to do that already) please send me a form (1099E I believe). Fill it out and pay what I owe and that's it ?
     
  10. tonyd2wild

    tonyd2wild Newbie

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    Oh no disrespect taken, as I said I NEVER had to deal with this stuff lol. Im sure everyone here is older than 25 and has dealt with the taxes, I have no clue about it and when I saw I made that much I was startled, but then again, I have been able to take care of myself more. I just will continue to run the business in a more legit way and save my money and prepare to pay what I owe 1.5k I can do that. I just thought that the IRS was thinking I am trying to be sneaky about this in the case I am not. My knowledge on this is not as high as many but its about that time.
     
  11. bartosimpsonio

    bartosimpsonio Jr. VIP Jr. VIP Premium Member

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    Talk to a certified accountant. Five minutes and they'll tell you all you need to know. I am unable to offer you tax advice as I'm not an expert. Either way if you plan on running a business of any kind you should have an accountant's phone nr. with you 24x7. Also, maybe you don't need to do what I suggested above....talk to a professional, I'm just trying to offer you ideas. I do know for a fact that if you correct the problem yourself, the fines/duties/fees are low, if you let the IRS find out on their own, it's major trouble for you.
     
  12. BHopkins

    BHopkins Moderator Staff Member Moderator Jr. VIP

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  13. STONESEO

    STONESEO Jr. VIP Jr. VIP Premium Member

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    do not worry that much....as you are making money from internet, when you fill out your taxes you could write that during that time you spent money on internet, you bought computers, you paid rent and stuffs like that to pay less taxes......
     
  14. tonyd2wild

    tonyd2wild Newbie

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    I already understand those consequence above again that is why I said i do those payments as "gifts" I am not selling the product to the buyer I am simple telling the buyer to pay for shipping fees the product itself is free
     
  15. tonyd2wild

    tonyd2wild Newbie

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    Well thats the thing lol. I spent 10k this year on sales via ebay, amazon, and stuff like that for book, computer, clothing, etc.
    HERE look
    Sales Activity 22,448.68
    Payments received 25,946.18
    Refunds sent -3,497.50
    Fees -259.21
    Payment fees -281.16
    Refunded fees* 91.03
    Chargeback fees 0.00
    Account Fees Invoice 0.00
    Other fees -69.08
    Dispute Activity -285.00
    Chargebacks & disputes -891.42
    Dispute reimbursements 606.42
    Transfers & Withdrawals 1,491.71
    Currency transfers 259.58
    Transfers to PayPal account 6,242.23
    Transfers from PayPal account -5,010.10
    Purchase Activity -23,142.74
    Online payments sent -10,771.75
    Refunds received 407.60
    Debit card purchases -12,778.59
    Debit card returns 0.00
    Reserves and releases 0.00
    Blocked Payments 0.00
    Other Activity -37.65
    Money market dividends 0.00
    Debit card cash back 0.00
    Credit card cash back 0.00
    Other -37.65
     
  16. Russian425

    Russian425 Regular Member

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    PayPal will send you a form (or you'll be able to download it) at the end of the year highlighting your profits.
    You take those profits and put them as extra income on your taxes. However, don't forget to write off your expenses (cost of products, rent, shipping materials etc.) So for example, if you made 22k but your expenses 21k, then you only pay taxes on 1k.

    Best thing go to accountant and consult with them. Don't use my advice as a legal or 100% accurate.
     
    Last edited: Nov 7, 2013
  17. tonyd2wild

    tonyd2wild Newbie

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    That sound extremely simple and what I needed to hear... So the form I will receive all I will need to do is take it to a accountant and they will know what to do from there?
     
  18. Asif WILSON Khan

    Asif WILSON Khan Executive VIP Premium Member

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    Follow this advice, talk to an accountant then contact the IRS.
    You will owe tax but it sound's like you can cover it.
    Obviously don't mention that you make your money with replicas (counterfeit goods).
    Talk to the accountant about the things you can claim for in running your business.
    Remember Tax Avoidance is legal, Tax Evasion isn't.


    Don't try bullshitting the Tax Man, they will only try to fuck you harder.
     
  19. Russian425

    Russian425 Regular Member

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    It's your job also to provide your accountant with expenses. So what you do is you give the accountant a total (will be on the form from paypal) and then break down of your expenses.
    So for example, your total transactions are 20k
    So what you give to your accountant a spreadsheet that you created that will have something like this:
    Total: 20000
    Total Expenses for the year:
    Fuel & Car Repair: 2000
    Rent: 2000
    Electricity: 1000
    Product Cost: 10000
    Advertisement: 2000
    Shipping Materials: 2000
    Education & School: (yes, you can write off your education if you paid for it out of pocket)
    and whatever else expenses you have.
    Total Expenses: 19000
    Total Profit: 1000, so you pay taxes on 1000 which is roughly $270.

    Hope it makes sense.


    Again, not a legal advice.
     
  20. Windmill

    Windmill Supreme Member

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    That would never hold up in court! I know of people who've gotten into MASSIVE trouble by selling replicas. In their case, they didn't even know it was a replica (warning for everyone, only work with legitimate suppliers!). Did the police care? No. It is clear you're doing this as a business, not out of the goodness of your heart - if that even matters at all.

    This can net you jail time... I wouldn't do it mate.