Auction sites IRS 1099 mandatory reporting for sales >US$600

[The Real MC]

This thread is not about the justification of adding sales tax to gear sold on auction sites (eBay, Reverb, Etsy, etc) as it would be too easy to stray into political discussion forbidden by forum rules.

 

On other gear sites I had been reading that the mandatory reporting of sales exceeding US$600 via a 1099 form to the IRS was the last straw for many non-commercial sellers.  Can't say I blame them.

That would leave the auction sites to commercial sellers, rendering them to a mere retail store and less of a source of bargains on used gear.  I have to admit I have not bought anything on auction sites since 2019 - I have enough gear.

Craigslist had never impressed me as there is a lot of junk on there.  I hadn't browsed CL for a few years, so a peek tonight revealed some high value gear I had never seen on CL in the past.  That tells me that non-commercial sellers who abandoned the auction sites are turning to CL.

So if you have gear to sell today, do you use the sell/trade rooms like the one here on MPN?

[mate stubb]

Usually only here. CL only if I can't move it on KC...

[FatFingers]

Wouldn’t it only have a downside if you are reporting a profit?  In my case, most of my sales of 2 or 3 year old gear represent break-evens or slight losses after deducting expenses for shipping, Reverb sales commissions, etc

[KuruPrionz]

I was on eBay since 2000. Slowly over time, they've managed to ruin it. 

I've bought and sold a very few things on Reverb, it's been OK but I no longer use it either. 

 

For the most part, I've been selling (and occasionally buying) on craigslist. 

I've bought and sold a fair number of items through friends. Often, that means they or I can borrow the item and give it a good test before purchasing. 

 

And I've bought some "interesting" things at thrift stores. Best fairly recent score was a vintage Ernest K. Ka'ai flamed koa ukulele with "rope" binding. It had a crack on the back and was missing one of the bar frets and one of the tuners. The Ernest Ka'ai ukulele company went out of business in 1920. I paid $5 for it and sold it on eBay a couple years back for $500 as-is. So it is worth a look at your local Goodwill, etc. 

 

I visit pawn shops sometimes but rarely purchase. 

In general I think you will have more concerns about stolen gear at pawn shops.  I don't think anybody steals stuff and then donates it to Starvation Army. 

 

 

[KuruPrionz]

Just now, FatFingers said:

Wouldn’t it only have a downside if you are reporting a profit?  In my case, most of my sales of 2 or 3 year old gear represent break-evens or slight losses after deducting expenses for shipping, Reverb sales commissions, etc

You will still get a 1099 and the joy of explaining (with full documentation) to the IRS. 

[Docbop]

I get the feeling this is more government BS to help big sellers and screw the little person like the internet state tax was setup to be.    There was a talk at NAMM a few years ago about the internet state sales tax collection and reporting and how it was setup to make the process too time consuming and error prone for small internet businesses.   The services that do it for small sellers start making it cost prohibitive for the little person.   The NAMM talk broke down all the gotchas in the internet tax that made it so complex.   

 

 

[KuruPrionz]

11 minutes ago, Docbop said:

I get the feeling this is more government BS to help big sellers and screw the little person like the internet state tax was setup to be.    There was a talk at NAMM a few years ago about the internet state sales tax collection and reporting and how it was setup to make the process too time consuming and error prone for small internet businesses.   The services that do it for small sellers start making it cost prohibitive for the little person.   The NAMM talk broke down all the gotchas in the internet tax that made it so complex.   

 

 

Which is why I prefer to sell locally. Craigslist has been good. The reason they are still how they are is that they do not have any documentation of the actual transaction. 

I always post "local cash only, I will not ship" and that seems to have eliminated scammers, at least for now. 

[Ledbetter]

I played a gig recently and the bandleader sent my money via PayPal. Before pp would disburse the small amount of money to me, they wanted personal information including my SS number. I passed and told the bandleader to contribute it to a charity. Things are getting ridiculous.

[HSS]

At the end of 2017, I was gigging weekly with a crappy band at a lonely dive bar that went out of business. Just before the bar made a public announcement about having a fire sale, I picked up a lot of house gear there on the cheap (e.g. QSC K12, Mackie mixer, Shure 58 mic, mic stands, cables, etc.).   Since then, my MO for buying gear on the cheap has been to gig in crappy bands at dive bars with no clientele. 😉

[ElmerJFudd]

Record of sale is useful if you are reporting a loss, ie. depreciation on an instrument you’ve worked with over X amount of years.  

[KuruPrionz]

1 hour ago, ElmerJFudd said:

Record of sale is useful if you are reporting a loss, ie. depreciation on an instrument you’ve worked with over X amount of years.  

Record of sale is "mandatory" if you are dealing with the IRS or state income tax. 😇