posted on December 15, 2001 09:54:53 AM new
I want to start filing taxes for my ebay profits starting at the first of the year - yes some people still do turn a profit on ebay. However, everyone that I call wounldn't even touch ebay and wanted nothing to do with it. Does anyone know of a tax guy who will handle an ebay business in south eastern Wisconsin?
posted on December 15, 2001 10:09:33 AM new
vetting, keep calling. What you are saying doesn't make a bit of sense. Just tell them you have a mail order business, which is what you have, essentially. The name Ebay shouldn't even come into it, except to deduct their fees in your business expenses.
Good luck to you, but self employed mail order business taxes is not a difficult thing for a tax account.
posted on December 16, 2001 01:46:08 PM new
Just tell them you have a small online business. It is really nothing more or nothing less.
I think I got lucky! An ebay bidder of mine is a CPA and does taxes in my area! Nice thing is they have some idea of the business and the questions to ask to make sure you are getting all the deductions you can.
I wonder what expenses I have that I have not even thought about being expenses. I know the obvious, all fees, postage, internet service, cell phone, mileage, fixtures, computer, office supplies, storage bins. What am I not thinking about???? I need to have more deductions or have to pay IRS too much money!
posted on December 17, 2001 08:45:25 PM new
Here is my question:
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When does selling on Ebay become a business.
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I started small, sold a few items and got hooked. Now I have invested over $11,000 in inventory and moving it pretty fast.
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How are you supposed to file? Schedule C income?
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Anyways my bank account shows the money coming in but fails to report the actual "profit" after deducting fees and supplies.
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For example you get $7 through Paypal and transfer it to your bank. You buy the supplies and shipout the item. You spend $6,
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so it leaves you a $1 profit. Right
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But your bank shows a $7 deposit. Does the IRS think its a $7 gain. Do you need to open a business to get taxed the right way?
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Also lets say I put some of the $11,000 on a credit card, are the interest tax deductible?
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And is it too late to open the business this year? Also what are the pros and cons for both scenarios?
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I'm also currently taking computer courses, are those courses deductable? they are related to my business.
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Need an expert opinion...
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[ edited by imagecomposer on Dec 17, 2001 11:02 PM ]
posted on December 17, 2001 09:44:44 PM new
imagecomposer - I am no CPA but I have worked in account for 20 years.
The way I understand it, once you buy anything with the purpose of reselling it = you are in business for profit. If you earn less then $600 per YEAR, you might be able to call it a hobby.
You file a Schedule C with your personal taxes. You deduct your expenses and should have the paperwork to back them up. Make records of your mileage to the PO and looking for stuff, etc.
I believe that Bank interest, credit card interest is NOT deductible unless you decide to become a corporation.
You will show your income ( $7.00 ) and your expenses ( $6.00 ) to get a to a profit of $1.00.
You do NOT have to be registered in your state to file a schedule C. Although, if your income amounts to anything you might becareful. Each state has different rules.
You need to check with your state as far as is it too late to become a business for the year 2001. They may chage penalities for operating with out being registered. Or you may want to file as opening 2002.
I highly suggest you contact a small business tax accountant. DO IT SOON! They get very busy mid-January til APRIL.
posted on December 17, 2001 10:01:53 PM new
what is the difference between ebay any any other business? I don't see any. You have the merchandise, which you buy and can be deducted, you sell and then you also have inventory. Seems easy to me but maybe not to a CPA. Who knows, but there must be someone that needs the business. Good Luck
