How do I file taxes from eBay income? How much do I have to have made?
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Q&A: How do I file taxes from eBay income? How much do I have to have made?
I actually already filed completely ignoring my ebay income but just for next year or an audit or whatever. How much do I have to make to have to file? Do I simply file as self employed? Is there any way I can create a yearly invoice from ebay or my purchases? Mostly I buy at yard sales and resell so how can I count that? Sorry this is so fragmented but thanks for the advice.
The answer in the following:
Answer by edward I
Usually over 0.00
Yard sales, forget it, unless you have a rental space in a Flea Market.
Answer by Anthony C
You just need to keep records–they don’t have to be fancy or look official, they just need to be accurate.
So, if you buy at a garage sale, record what you bought, for how much, and when you sell, record what you sold, for how much. Then, track your other legitimate expenses. There are excellent websites which explain what constitutes a legitimate expense. Add up all your costs (purchase prices, other expenses, ebay charges, paypal charges, shipping, whatever). Add up all your sales. The difference between these two numbers is income and is taxable, exactly as other income is taxable. You are actually self-employed, running a small business. As a self-employed individual, you can set up retirement accounts, and do all the other things any self-employed person can do. But, you also pay taxes, not just income taxes, FICA, and medicare taxes, but also the employer share of FICA and medicare taxes.
Granted, it probably seems easiest to just ignore all of this, but the law is the law, and most of us want to pay our fair share. And, there is always that pesky audit out there. It costs much more to pay penalties and interest than it does to do it right from the very beginning. There is one exception to the need to pay taxes on your ebay income. If you are filing as a single individual and your total income (not just ebay income) was below the required dollar amount to have to file, then you don’t have to. The same is true if you’re filing jointly with a spouse and together your income falls below the filing requirement. But, if you have to file, then you have to report all income, not just income from regular jobs.
Answer by popeye
Schedule C and if you make over 400 dollars don’t forget the SE tax.
Answer by Judy
There’s not a specific amount you’d have had to make, it’s your intent to earn money by this, making it a business.
Keep very good records of what you pay for the items you sell, and what your expenses are ebay fees, packing and shipping, and any other related expenses. You’ll have to keep track item by item, since you can’t just subtract the cost of everything you bought from your income. Since you’ll have inventory, you’ll have to file a schedule C, not C-EZ, and your recordkeeping will take a lot of attention and time. You’ll also file a schedule SE to calculate your self-employment tax. The numbers from the schedules will transfer to your 1040.
It would be a good idea to talk to an accountant for advice on what kind of records you need to keep.
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