Form 1099 from PayPal?

[perc-o-prince]

Pardon if this isn't in the correct forum, but I wasn't quite sure where to place it.

Did anyone else get a 1099 from PayPal? Was it a surprise? What are you doing with it? I noted there's a "Federal ID" number (must have been made up on our behalf by PayPal) and not a social security number on it.

How much of a damper will this put on your selling if that "income" needs to be claimed and taxed (though the goods sold have already been taxed several times as well as the $$ that paid for said goods)?

Chuck

 

[launderess]

You are not alone

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esellercafe.com

 

[scoots]

Lauderess:

Many thanks for this valuable link.

 

[lorainfurniture]

I got dinged

A 1099 for six figures. Oy

 

[launderess]

@ScootsTN - You're welcome.

Now am going to say something and don't want it to turn this thread into a huge political free for all rant.

That being said both states and federal government need revenue. States in particular since they cannot "print money" like US government *and* most all state constitutions mandate balanced budgets are looking for ways to get funds without raising taxes.

What began and still is a hobby for some people, has become for others a major source of income. Places like eBay today are full of "power sellers" with various stores or whatever. Unlike much of Europe and elsewhere where online sales are subject to VAT, here we basically have none of that. In state sales are obliged to collect/pay sales taxes, but not every one does.

As link above mentioned federal government long ago mandated Paypal and other such places start reporting credit card transactions above a certain threshold, now it seems many states are getting into the act by enacting their own reporting requirements.

Over the past few years since Congress passed those reporting laws it seems everyone and their mother began getting 1099 requests. Know from friends locally that own small businesses IRS agents have been "working the street/building" conducting spot audits especially looking for people/businesses that should have 1099 information, but its lacking. At that point people have no choice; IRS makes it clear they will be back to check and see if the proper forms were requested.

 

[panthera]

This serves every single Republican voter here right.

Between trillion dollar new deficits and 'tax reforms' which ain't, I've had it with conservatives complaining about us 'tax and spend' Democrats.

Well deserved and totally just deserts.