posted on March 7, 2001 06:23:49 AM
My husband and I have an on going argument about our ebay tax situation. He has an extensive collection that we have been selling on ebay. He believes that we do not have to claim this income due to the fact that it is a personal collection. My argument is this: INCOME IS INCOME AND YOU HAVE TO CLAIM ALL INCOME. I have also heard that if you are selling a personal collection that you can not claim any deductions. I have tried to get him to see an accountant, but I think he is afraid to hear what they have to say. Please help us out on this. It has been the Battle of the Roses around here! Any advice would be greatly appreciated.
posted on March 7, 2001 06:30:10 AM
I would consult a professional here, but if he is selling the collection for more than he paid, that is a gain and is taxable.
posted on March 7, 2001 07:29:24 AM
A "hobby" seller can not deduct expenses from any profit made on the sales, other than the actual purchase cost of goods sold, nor can he/she deduct any loss on the hobby from income .
If you have profit or loss, it would be wise to consider being a going business.
The only situation where I can see being a hobby seller is if you break even.
posted on March 7, 2001 03:26:26 PM
According to my CPA, if I acquired my hobby collection without intending to sell, then it's taxed at the capital gains rate.
posted on March 8, 2001 12:35:33 PM
Selling stuff that is part of a collection probably needs to be recorded on a Schedule D - go to H&R block or some other tax advice place and get his head straighted out on this issue fast!
