Bubbles Bursting 8 8

[70s80sTimeMachine]

On 2/2/2022 at 6:37 AM, Shrevvy said:

This is not correct. Buying inventory does not reduce taxable income. Cost of purchases get added to inventory and is charged against revenue once the product is sold. The Schedule C calculation might make it confusing as it looks like inventory is deducted. 

Example. Purchase one book for $100 and sell for $200. No begining inventory. Cost of Goods is $100 and gross profit is $100. Schedule C looks like this (ignoring labor and other costs):

Beg Inventory $0
Purchases +$100
This equates to Line 40 on Scedule C = $100

End Inventory $0 (because you sold the book) Line 41

Subtract Line 41 from Line 40 = $100

Cost of Goods is $100

Now assume you purchase two books each for $100 and sell one for $200. No begining inventory. Cost of Goods is still $100 and gross profit is still $100. Schedule C looks like this (ignoring labor and other costs):

Beg Inventory $0
Purchases +$200
This equates to Line 40 on Scedule C = $200

End Inventory $100 (you now have one book you paid $100) Line 41

Subtract Line 41 from Line 40 = $100

Cost of Goods is $100

Inventory purchases do not change cost of goods. The cost of inventory is only netted against sales once the product is sold. 

 

Thanks for posting this. I have to dig more on this. My specific strategical scenario was not same year but rather say you bought a bunch of new comics end of year as prices soften in December and held into the next effective tax year. Because you still have to subtract line 41 from 40; this would not benefit the current existing tax year. Interesting.

FYI I removed those specific few lines out of the original post but the rest is accurate with respect to Schedule C and 1 logistics, so I left that alone.

 

 

Edited February 2, 2022 by 70s80sTimeMachine

[jimbo_7071]

On 2/2/2022 at 12:10 AM, 70s80sTimeMachine said:

Other than Bats and Supes, I have frankly not closely monitored the GA market. I am however super attached to BA and in the last 12-14 months several keys have doubled in price and are consistently selling at that high price point even presently with now increased supply getting dumped into the marketplace. Great example is ASM 252 CGC 9.8 still making higher highs.

I can understand say if you had a GA slab show up that perhaps you only get one shot in a year or more at; sure hammer price can go to the moon. But more consistently across the board, have you see this same kind of massive uptick price action in particular just the last 12 months as well?

Kind of reminds me of a blow-off top potential. This past week I bid on nearly 50 CL auctions all within the last ending 5 minutes; many I snipe attempted, across SA and BA and I only won 10. My bids were not terribly aggressive but by no means weak or thrill-seeking. And also I'm seeing quite a bit of 9.6 slabs now fetching what 9.8's were getting only 2-3 years ago. It's as if I'm in the twilight zone. 

 

I used to own two copies of ASM 252. (I sold them for a few dollars each over 20 years ago when I got out of Copper/moderns.) That was a book that practically every Marvel collector was saving from the day it showed up on the rack. I don't know what the print run was, but there must be a massive number of raw copies still out there in very high grades. Maybe the newsstand edition is scarcer than the DM edition, but I'm not sure about that. When that book came out, there was still a spinner rack in every corner store (but a lot of books got spine ticks flopping around on those spinner racks).

Edited February 2, 2022 by jimbo_7071

[Math Teacher]

Just out of curiosity, should a person have received any 1099s by now?

[sfcityduck]

On 2/2/2022 at 8:26 AM, Math Teacher said:

Just out of curiosity, should a person have received any 1099s by now?

You have to go and get it off of eBay.  Mine was available for download today.  Note:  I'm not a dealer.  It was for casual sales.

[Pantodude]

On 2/2/2022 at 11:26 AM, Math Teacher said:

Just out of curiosity, should a person have received any 1099s by now?

We'll provide you with Form 1099-K by January 31 each year if you've received payments above the minimum IRS reporting thresholds in the previous calendar year:
 

IRS minimum reporting thresholds	2021	2022
Gross payments	$20,000	$600
Transactions	200	n/a

[Robot Man]

On 2/2/2022 at 9:03 AM, sfcityduck said:

You have to go and get it off of eBay.  Mine was available for download today.  Note:  I'm not a dealer.  It was for casual sales.

Would not have gotton an email from them telling you it was there?

If not, how would I find it? 

[sfcityduck]

On 2/2/2022 at 10:31 AM, Robot Man said:

Would not have gotton an email from them telling you it was there?

If not, how would I find it? 

No email came to me Bob.

1. In My eBay pull down menu click on "Selling"

2. In "Selling" click on "Payments" (at top)

3. In "Payments" click on "Taxes" (at side, also on Payments pull down menu) - might make you log in again after you click taxes

4. You're there.

 

Edited February 2, 2022 by sfcityduck

[Professor K]

On 2/2/2022 at 1:35 PM, sfcityduck said:

No email came to me Bob.

1. Go to Payments - opens in new window or tab in My eBay.
2. Select the Taxes tab.
3. Select 1099-K Forms.
4. Select Request detailed report.

And on pay pal its in the activity tab. 

on my e bay page its - account > payments >reports. There is a drop menu with 1099 in it.

Edited February 2, 2022 by Professor K

[sfcityduck]

I edited my post for better instructions for eBay.

[adamstrange]

On 2/2/2022 at 1:27 PM, Pantodude said:

We'll provide you with Form 1099-K by January 31 each year if you've received payments above the minimum IRS reporting thresholds in the previous calendar year:
 

IRS minimum reporting thresholds	2021	2022
Gross payments	$20,000	$600
Transactions	200	n/a

Looks like 2022 is the year we finally catch those tax-evading billionaires! 

[Robot Man]

On 2/2/2022 at 10:35 AM, sfcityduck said:

No email came to me Bob.

1. In My eBay pull down menu click on "Selling"

2. In "Selling" click on "Payments" (at top)

3. In "Payments" click on "Taxes" (at side, also on Payments pull down menu) - might make you log in again after you click taxes

4. You're there.

 

Thanks, I think…

To tell the truth, I rarely sell there anymore. I was WAY under the 20K and 200 transactions that I believe were permitted in 2021.

I sold a lot more here using PayPal. I’haven’t received anything for them yet.

Other than doing a lot more live shows from this point forward, I have no plan in place for mail order sales yet from this point forward.

I am real good at buying and selling junk. Not so much at numbers or accounting. Something that is just a big hassle to me. 

[MusterMark]

On 2/1/2022 at 2:22 PM, MrBedrock said:

A much better option than dealing with accountants and taxes is dealing with a reputable comic dealer/collector who will make you a generously fair offer for your potential headaches.

Why endure stress and suffering? Contact Richard at Bedrock City (richard@bedrockcity.com) and offload all of your troubles!

Bedrock City - The comic shop that makes lives better will do your taxes for you!

Fixed that fer ya.

(There's a reason Taxes is an anagram of Texas)

 

[Surfing Alien]

I suspect that, when the IRS gets swamped with a massive number of returns claiming modest earnings from the army of ebay and etsy side-jobbers who might be reporting for the first time, they will come up with a safe-harbor provision of some sort that will allow the filer to accept a set percentage of the gross income to be taxed as profit.

Offering that safe-harbor would seem be the only way for them to avoid the huge cost of arbitrating tons of small dollar discrepencies and still allow them to collect a lot of tax that was previously unreported by removing much uncertainty for the filer 

[Math Teacher]

On 2/2/2022 at 12:35 PM, sfcityduck said:

No email came to me Bob.

1. In My eBay pull down menu click on "Selling"

2. In "Selling" click on "Payments" (at top)

3. In "Payments" click on "Taxes" (at side, also on Payments pull down menu) - might make you log in again after you click taxes

4. You're there.

 

I did as you said, and I never saw a link for taxes. Also, I looked in the Reports section, and I didn't see anything there either.

[70s80sTimeMachine]

On 2/2/2022 at 6:37 AM, Shrevvy said:

This is not correct. Buying inventory does not reduce taxable income. Cost of purchases get added to inventory and is charged against revenue once the product is sold. The Schedule C calculation might make it confusing as it looks like inventory is deducted. 

Example. Purchase one book for $100 and sell for $200. No begining inventory. Cost of Goods is $100 and gross profit is $100. Schedule C looks like this (ignoring labor and other costs):

Beg Inventory $0
Purchases +$100
This equates to Line 40 on Scedule C = $100

End Inventory $0 (because you sold the book) Line 41

Subtract Line 41 from Line 40 = $100

Cost of Goods is $100

Now assume you purchase two books each for $100 and sell one for $200. No begining inventory. Cost of Goods is still $100 and gross profit is still $100. Schedule C looks like this (ignoring labor and other costs):

Beg Inventory $0
Purchases +$200
This equates to Line 40 on Scedule C = $200

End Inventory $100 (you now have one book you paid $100) Line 41

Subtract Line 41 from Line 40 = $100

Cost of Goods is $100

Inventory purchases do not change cost of goods. The cost of inventory is only netted against sales once the product is sold. 

 

Just circling back here. This is why I prefer email/texting medium vs. physical conversations, especially with a fast talker. I reached out to this individual again last night; apparently he got into a little liquidity pinch toward end of year in the past at some point and had to unload more illiquid type inventory and realized a decent size loss and not just comic related. So when all the numbers added up for the calendar year it sounds as if he landed with a negative number in line 31 of Schedule C.

This negative number or loss apparently gets carried over to the Schedule1 which then ultimately is routed to the main 1040 thus having some kind of a decreasing impact on aggregate taxable income or possibly a NOL type effect?? Perhaps I still don't have all the logic completely correct but initially I had misconstrued his specific set of unique circumstances and extrapolated that to an overall benefit of carrying a debit purchase of new inventory into a new calendar year and I greatly appreciate you catching this. Thanks!

[Robot Man]

On 2/2/2022 at 3:29 PM, Math Teacher said:

I did as you said, and I never saw a link for taxes. Also, I looked in the Reports section, and I didn't see anything there either.

Me neither. Would having a resale certificate on file with them have anything to do with it? If so, how would I know if I owe any taxes? I have received nothing by mail or email to date. 

[jimjum12]

On 2/3/2022 at 9:19 AM, 70s80sTimeMachine said:

This negative number or loss apparently gets carried over to the Schedule1 which then ultimately is routed to the main 1040 thus having some kind of a decreasing impact on aggregate taxable income or possibly a NOL type effect??

A loss on Schedule C will affect your taxable income on your regular job, resulting in less taxable income. In my State a loss is allowed only 2 out of 5 years. GOD BLESS... 

-jimbo(a friend of jesus)

 

... if you add outside capital to your inventory it can show as profit that you didn't actually make. I learned that the hard way one year. As said, get with your accountant to avoid costly misconceptions. 

[Professor K]

On 2/2/2022 at 6:29 PM, Math Teacher said:

I did as you said, and I never saw a link for taxes. Also, I looked in the Reports section, and I didn't see anything there either.

 

On 2/2/2022 at 6:29 PM, Math Teacher said:

I did as you said, and I never saw a link for taxes. Also, I looked in the Reports section, and I didn't see anything there either.

 

On 2/3/2022 at 5:47 PM, Robot Man said:

Me neither. Would having a resale certificate on file with them have anything to do with it? If so, how would I know if I owe any taxes? I have received nothing by mail or email to date. 

Almost 100% positive that they DO NOT send a 10-99 if sales were less than 20k or 200 transactions. Next year will be a different story. You can find your sale numbers in seller dashboard going back until Feb. 2021, 12 months. Just if you didnt already know.

 

[Robot Man]

On 2/3/2022 at 4:06 PM, Professor K said:

 

 

Almost 100% positive that they DO NOT send a 10-99 if sales were less than 20k or 200 transactions. Next year will be a different story. You can find your sale numbers in seller dashboard going back until Feb. 2021, 12 months. Just if you didnt already know.

 

Thanks! I figured that might be the case. I was well under 20K.

From now on, who knows. I hope to do primilary live shows.

The good old days of EBay are over…

[Professor K]

On 2/3/2022 at 9:00 PM, Robot Man said:

Thanks! I figured that might be the case. I was well under 20K.

From now on, who knows. I hope to do primilary live shows.

The good old days of EBay are over…

Oh yeah they've been over for a while. This was the final nail. Now it's time to go back to a simpler time. A time when people paid with checks and postal money orders. A time when people trusted each other not to rip each other off. A time when even though the guy sounded legit you still feel stressed until the package arrives.