New IRS reporting for 2021? 8 8

[KPR Comics]

Do dealers issue 1099s to their consignors?

[ttfitz]

11 hours ago, rapid08 said:

Again, I'm not a lawyer and what I said should not be considered legal advice

Sounds like something a lawyer would say.

[fantastic_four]

On 3/8/2021 at 3:32 PM, F For Fake said:

On 3/8/2021 at 3:25 PM, Wolverinex said:

A big question is selling comics that you've held over a year.. are you charged at a long term capital gains tax rate and how does ebay know?  

See, these are the questions I'm going to have to get answered. Do I need to save every receipt for every comic I buy, in case I sell it somewhere down the road?

My past understanding of both of these questions is that most physical objects aren't charged the capital gains rate, they're counted as normal income.  I've seen IRS guidelines explicitly noting collectibles as being subject to your overall income rate and not the lower capital gains rate.

For saving receipts that shouldn't be necessary, but do record what you paid at the time you paid it.  I heard that advice 25 years ago and have followed it ever since.

[jimjum12]

On 3/17/2021 at 3:46 PM, KPR Comics said:

Do dealers issue 1099s to their consignors?

Paypal and eBay are the only ones I've seen do anything like that. I've never received a 1099 from anyone else that I've sold through or used the services of. I never really understood why they needed one to be sent. 1099's I've received in the past were primarily for off street labor or temporary jobs where taxes were not taken out or I was not considered full time. I certainly never worked for eBay or Paypal. GOD BLESS...

-jimbo(a friend of jesus)

[Buzzetta]

The problem here is that many of you guys are thinking with a narrow vision of selling comics.  If this was around in the mid 90's I think a lot of people would find themselves in serious trouble.  (Are college textbooks even a thing now?)

Who here sold their college textbooks back across the year? Did you declare it?  I know that a college student selling off their used textbooks generated at least $600 back then across two semesters (one fiscal year).  The semester is over, sell back your books or put post it notices up all over campus to sell your books directly to another student.   Let's say that I was right on the cusp of when money would physically change hands and when you would sell old textbooks on eBay or Half.com (remember half.com?). Obviously students took a loss but you would have exceeded that threshold.  No one reported that kind of stuff back then.

Naturally if you are buying and selling comics you should be reporting gains and losses.

My eyebrow raising is the mom and pop and kids who are cleaning out a garage and figure let's get what we can for this junk.  They are not filing the paperwork and are probably unaware of any of this to begin with.  Here in New York many people just go to eBay to get rid of their junk.  I mean, eBay itself has aired commercial after commercial that they are the place to do such a thing.   How about that app that says just take a picture and name a price and we will do the rest.   

There are a lot of people that will be painfully unaware of all of this and even though they are taking what we would consider a loss on this, could be potentially screwed over by this when it comes to getting rid of old golf clubs or an old anything.

So what is going to happen?  Welcome back to the local garage sale, the local Facebook Marketplace and whatever else offers person to person cash exchanges.  Some of you will write about civic duty and that's cute. However, let's face facts.  I can tell based on the Nextdoor App (Local community social network) Facebook marketplace, and even Craigslist that those venues will generate traffic, while sites like eBay, using PayPal to sell things across the nation and anything like that will decline.  

Your average citizen does not want to deal with the paperwork to report a loss to the IRS on something like an old bicycle or common household items like child's toys, cribs, shoes and things like that.   Now, anyone who says that they should, is absolutely right.  They should.  However, that emphasis is on 'should'.  People also should not talk on a cell phone when driving, should not speed, should not roll through a stop sign, and should not do a lot of things.  However, they get done, as evident by the Nassau County Police Officer I saw this evening on his cell phone while driving who decided he did not want to wait for a red light and went right through it. 

Such are human beings and such is life.   

 

So I guess things are going back to 1998 where sellers would only accept checks or money orders from me and then if they tried to screw me over, I sent someone to their house or I made their life a living breathing hell. 

Edited March 20, 2021 by Buzzetta

[MyNameIsLegion]

my dad just passed away, and there may come a time where my brother sells some items, mostly books, many of which were gifts from us or bought used over the course of 50 years. You think we have receipts? The fact it wasn't worth declaring any itemized value for any of dad's physical property agains't his estate? I bristle at the idea that I've got to do a bunch non value added paperwork benefitting no one thanks to this.

[KPR Comics]

25 minutes ago, MyNameIsLegion said:

my dad just passed away, and there may come a time where my brother sells some items, mostly books, many of which were gifts from us or bought used over the course of 50 years. You think we have receipts? The fact it wasn't worth declaring any itemized value for any of dad's physical property agains't his estate? I bristle at the idea that I've got to do a bunch non value added paperwork benefitting no one thanks to this.

My condolences.  For what it's worth, I believe you get a step up in basis to current value.

[inapicklecomics]

Let's say I buy a comic for $25k, log it in quickbooks, then sell it on ebay for 26k.  Ebay sends me a 1099 for 25k, but my profit is only 1k.  Am I able to just input 1k on my taxes, or will I face some other steps needed since the discrepancy will be 24k?  I was wondering if my taxes will be flagged/audited if they see that 24k difference. 

[F For Fake]

[shadroch]

23 minutes ago, inapicklecomics said:

Let's say I buy a comic for $25k, log it in quickbooks, then sell it on ebay for 26k.  Ebay sends me a 1099 for 25k, but my profit is only 1k.  Am I able to just input 1k on my taxes, or will I face some other steps needed since the discrepancy will be 24k?  I was wondering if my taxes will be flagged/audited if they see that 24k difference. 

If you bought a book for $25,000 and sold it on ebay for $26,000, you did not make a $1,000 profit. You lost money on the deal.

[ADAMANTIUM]

10 minutes ago, shadroch said:

34 minutes ago, inapicklecomics said:

Let's say I buy a comic for $25k, log it in quickbooks, then sell it on ebay for 26k.  Ebay sends me a 1099 for 25k, but my profit is only 1k.  Am I able to just input 1k on my taxes, or will I face some other steps needed since the discrepancy will be 24k?  I was wondering if my taxes will be flagged/audited if they see that 24k difference. 

If you bought a book for $25,000 and sold it on ebay for $26,000, you did not make a $1,000 profit. You lost money on the deal.

kind of missing the point of his question 

[ADAMANTIUM]

ok if I make no profit

but a 1099 is reported of 25K in sales.

and I owe no taxes, do I need to call the irs to explain that they are /////

do I need to worry?

do I need to file it under taxes?

[ADAMANTIUM]

I'm in a mood I can see that

even $600 is just taxing  

I mean it is up to me to do so, so why wouldn't I report it, make it up in volume. silly

just report a loss? just report period? Make it what it is and tell the professional 60 transactions with receipts (hopefully) and let them ask questions for any deductions?

 it's the song that never ends, and it can seem overwhelming so I see the need for the thread to continue but  

Those who are retired, may have the time to discuss with a professional and have everything in order, but again, those who don't owe taxes and haven't in a while 

are just trying to come to terms ......

[awakeintheashes]

Putting on my day-job hat for a second, I'm 85% certain this gets fixed (threshold raised, exemptions added, etc.) this year along with a few other non-controversial provisions of the Act that most have acknowledged will have unintended consequences in their current form.

Edited March 22, 2021 by awakeintheashes

[Beige]

19 minutes ago, awakeintheashes said:

Putting on my day-job hat for a second, I'm 85% certain this gets fixed (threshold raised, exemptions added, etc.) this year along with a few other non-controversial provisions of the Act that most have acknowledged will have unintended consequences in their current form.

Could you expand on this?

[OuterboroGuy]

On 3/18/2021 at 9:14 AM, fantastic_four said:

My past understanding of both of these questions is that most physical objects aren't charged the capital gains rate, they're counted as normal income.  I've seen IRS guidelines explicitly noting collectibles as being subject to your overall income rate and not the lower capital gains rate.

For saving receipts that shouldn't be necessary, but do record what you paid at the time you paid it.  I heard that advice 25 years ago and have followed it ever since.

Collectibles are taxed at a capital gains rate of 28%, unless you are a dealer, in which case it is ordinary income (i.e., net sales).   Also, if you flip a book within a year, its taxed at your full rate (not capped at preferential longer-term capital gains 28%).

Edited March 22, 2021 by OuterboroGuy

[Beige]

Do you guys have an 'ownership period of time' exemption?

As in - if you own it for say 10 years, it is tax exempt?

 

W do here, but as Australia follows USA in most things, I fear this is only 3-4 yrs away for us.

Currently pre 1996 purchases and under $600 are exempt, but I'm sure that will change.

I have some books I bought way back when that are four figures now, plus the usual garage sale 'no receipt' purchases that we all have.

 

Look if I make 3k on a book in a year - I expect to pay taxes - on a book I have owned for 40 yrs, not so much.

[awakeintheashes]

22 minutes ago, Beige said:

Could you expand on this?

How so? Legislative fixes will most certainly be introduced to provide relief to the sellers @Buzzetta mentioned in his post. Given that the change to the De Minimis threshold will affect the constituents of many lawmakers on both sides of the aisle, leads me to believe certain fixes will be passed to change this provision of newly passed law ($600 De Minimis threshold for 2022 tax year).

Edited March 22, 2021 by awakeintheashes

[Beige]

Just now, awakeintheashes said:

How so? Legislative fixes will most certainly be introduced to provide relief to the sellers @Buzzetta mentioned in his post. Given that the change to the De Minimis threshold will affect the constituents of many lawmakers on both sides of the aisle, leads me to believe certain fixes will be passed to change the newly passed law ($600 De Minimis threshold for 2022 tax year).

I'm Australian, so I'm watching from afar - I have no knowledge of your IRS rules beyond what people write here.

My only interest is that it's certain to head our way in a few years time if it proves profitable over your way. 

[awakeintheashes]

14 minutes ago, Beige said:

I'm Australian, so I'm watching from afar - I have no knowledge of your IRS rules beyond what people write here.

My only interest is that it's certain to head our way in a few years time if it proves profitable over your way. 

Got it. I'm still planning like I will receive a 1099 based on current law and telling everyone that I know to plan accordingly, but it seems like a glaring issue and easy fix. We'll have to wait and see.