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New Paypal Tax law for Sellers

Discussion in 'Ebay' started by bizzzy, Jan 24, 2011.

  1. bizzzy

    bizzzy Newbie

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    been doing some research on this forum for a while now and found some good ideas and some bad ones lol. My friend is testing out the replica biz and tested some suppliers making good money with mixed feedback from buyers. One of the suppliers was a lying sack and a couple of buyers sent the items back but still gave him good feedback . It's all about communication with the buyer. Accept returns, refund promptly, play stupid and he has yet to have a negative feedback(crosses fingers).When your top rated and have excellent feedback most people trust you with an occasional ball breaker.

    Now, he has found a very good supplier with some excellent items and am getting offers daily making 3-4 times what he paid for it. Some items he is making 7-8 times what he paid for them. Mind you he lost some money in the beginning but is fighting the supplier for it and trying to get rid of the mediocre items under the radar and still make a profit .

    Now his question is with this new paypal tax law for sellers if you go over 20k a year on an acct you have to pay taxes on the items your selling. This worries him because he is already at 4 k and counting for the year gross and its only january. He has 3 paypal accounts atm and is thinking of opening a few more to switch the paypal payment to that address before each one goes over 20k because ebay fees and paypal fees are like 12% tax and now the irs wants their cut. Now if one goes over 20k which is easy to do when your dealing with high end items ,is he expected to provide to the irs what he is selling and where he is getting the items?
     
    Last edited: Jan 24, 2011
  2. bizzzy

    bizzzy Newbie

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    double post
     
    Last edited: Jan 24, 2011
  3. SupraFast

    SupraFast Junior Member

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    It's not a paypal law...It's a USA law. If you're single, under the age of 65, and your total income is more than $9,350.00 then you have to file taxes period. If you're self employed, you have to file taxes if you make over $400.00
    [​IMG]
     
  4. mixxin

    mixxin Registered Member

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    This new law mandates any US credit card merchant account or payment provider like Paypal, Google checkout etc to report your earnings to the IRS if you have over 200 transactions and/or $20,000/year or more in sales.

    That said, I'm sure people will have some creative ways around it. i.e. multiple payment processor accounts while staying under those triggers.
     
  5. xbox360gurl70s

    xbox360gurl70s Elite Member

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    even when you are outside the US, you experience US taxes lol
     
  6. phluid

    phluid Power Member

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    Yes, I hate this new law. I am hoping to see some ways around it as I have nothing yet. I normally clear that 20k every month, sometimes it takes 2 but it is going to increase big time within the next 3 months.
     
  7. freqout

    freqout Regular Member

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    Multiple ebay/paypal accounts, easy. I dont know why you guys are so worried, make a few new ebay+paypal account, age the accounts and get feedback so they have no selling limits by the time you need them. Once Jan 1st rolls around again, you can reuse th accounts again, if you are doing 10k a month even, that is 6 accounts per year, just change them out when you hit 19k.
     
  8. phluid

    phluid Power Member

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    I won't change my ebay account, have to many regulars that purchase along with many feedbacks. If I changed my paypal account only I assume they are doing some kind of tracking on that. Oh well, I am sure it can be countered somewhere.
     
  9. imperial109

    imperial109 Regular Member

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    When you're inside the US you work your way around them :D
    Read the things that big corporations do and follow by example, especially when some of the local reps can be bought(i mean donated) for $2000 a year XD
     
  10. theinspirond

    theinspirond Newbie

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    seriously, it's all 1 big circus
     
  11. emosquito

    emosquito Newbie

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    its just filing taxes like everyone else ...
     
  12. Mick Swagger

    Mick Swagger Newbie

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    Yeah, just open up several accounts and rotate, keeping the 20k + amount spread across those accounts.
     
  13. yee941

    yee941 Newbie

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    thats a good idea
     
  14. TNphoneman

    TNphoneman Senior Member

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    Why are you worried about the KGB oops IRS taking 10% now when you will just have to pay it later. For those outside the US I can feel for you....

    For those in the US, you are going to have to pay it anyways. But it does make it an accounting hassle.
     
  15. yee941

    yee941 Newbie

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    not a big deal I guess
     
  16. teamred

    teamred Newbie

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    Because of the US tax laws our country is still a free functioning enterprise where you are free to make money and do as you please. I hate the IRS as much as the next person but i believe in paying my fair share and not a penny more.

    For every person that cheats on there taxable income is basically have me pay it for them. I say you should man-up and pay your own way through life. I am not F***king you so why should I pay your share. Sure the government does not spend the money wisely but they what we have and if you voted then complain but if you did not vote then you do not have a right to.

    Either pay your fair share of taxes or move out of the country, do not do business with people in the US. I am tired of new taxes and tax increases all of the time. I only should have to pay my part, not yours.

    Be thankful you made money and have this problem. Many people would gladly pay 10% to 33% of their pay to trade places with you. Hell - we even get to itemize our tax forms so that we can deduct legitimate business expenses. What more could a person ask for. (You got an inch so stop trying to take a mile)