Quote:
Originally Posted by Fred
I was being facetious with regard to N54 BST and any tax implications. However, if we all want to be good citizens and pay our taxes on what used to be a hobby transaction, then we conform.
It's understood what paypal appears to be doing at this time. It seems like they're trying to be compliant with new government regulations and prepping people for what's coming.
I rarely sell things so this doesn't impact me, but at least I'll be aware of this if I ever do decide to start selling via ebay.
What happens with AHs? If you consign something and the AH cuts you a check for $40K, does that get reported? Or has that been a standard practice for a while?
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Fred,
No problemo, I wasn't in the least picking on you, and thought you might be joking around a bit. I just get concerned that someone else may not get that same take, and maybe think what you were talking about could seriously be true. Just like the post and my earlier response to Ben Young in this thread. He didn't see or know about the earlier thread here on the forum before Christmas, talking about the one-year deferral of the lowered 1099-K reporting threshold for Paypal G&S payments, and other TPSOs, to issue 1099-K forms to people. It is often the case that people who are not on here every single day may miss out on some important facts or issues being brought up that could affect them and their hobby activities. And when I see others posting things, especially regarding tax aspects of the hobby, that may not be really clear or easily answered, I try to make it a lot clearer for them and others by responding so that have a better idea and/or understanding of at least what to be aware of and look out for.
Unlike everyone debating who is or is not the greatest lefty of all time, or who does or doesn't belong in the HOF, those questions and debates don't really involve someone on the forum getting caught in a tax situation they didn't know about and weren't prepared for, and possibly costing them actual time, and money, by their lack of knowledge and potential improper handling of their tax situation in relation to their card collecting hobby activities. Much of what I'm sharing with members on here can save people time and money in the long run, or at least better prepare them for what may be ahead, and hopefully make their lives a little easier. If nothing else, it should give them info to at least know what questions to possibly ask their own tax preparers/professionals when the time comes. Also, if you do end up having questions for your tax preparer/professional, don't wait till after the end of the year to finally ask them. You want to ask them before the current taxable year ends, so they can maybe advise you on what you may want/need to change to help save you some tax money. And the earlier in the actual tax year you ask them, very often even better. Waiting till December to ask you tax person questions may still make it difficult, or even impossible, to have time to change things to your benefit.
Now, as for the question I was going back and forth with Scott about, whether AHs may be liable at some point for sending 1099s to their consignors, I'm hoping since he's a member of the National Auctioneers Association (NAA) that he can contact them for some clarification on their article I saw and posted a link to, and what exactly AHs are exempt from when it comes to having to prepare and send 1099s to the people they sell for. As I pointed out to Scott, the exemption he referred to may only be for AHs not getting considered the same as say Paypal G&S. Without that exemption, it would potentially make Scott's auction company a Third Party Settlement Organization (TPSO) (just like Paypal G&Ss) which would then require him to probably prepare and send 1099-Ks to every consignor that he collected more than $600 dollars for during the calendar year, along with also sending a copy to the IRS. He, and every other legit and licensed AH does not have to worry about or do that, as they are exempt form being considered as TPSOs.
But then, what about any 1099-K forms that say Paypal G&S may send to Scott's auction company for payments his auction company accepted during the year from/through Paypal G&S (or any other TPSO his action company also accepted sales payments on behalf of his consignors through)? The "nominee" reporting rules for taxable income/sales that you accept/receive on behalf of someone else are pretty clear. The taxable income/sales you received and got reported to you on a 1099 issued in your name as the recipient or payee, but that actually belongs to someone else (your consignors), should then be reported on a "nominee" 1099 of the same type of 1099 that you initially got that included your consignor's taxable income/sales. Except now, you are supposed to prepare a 1099 form as the payor, and make it out to the consignor as the payee/recipient you collected the taxable income/sales for. You show the amount of actual taxable income/sales that you received on behalf of each consignor, that was originally reported to you as the payee/recipient. And you're supposed to send a copy of those "nominee" 1099s to each party/person you collected/received such taxable income/sales on behalf of, along with filing/sending an additional copy with your friendly neighborhood IRS.
At the moment, it is a "gray" area I do not know the definitive answer to....yet. Hopefully Scott can get someone at the NAA to better confirm exactly what the 1099 reporting exemption they got feedback on from the IRS exactly does, or does not, cover, and if that also extends to "nominee" reporting requirements by AHs as well. I fear the answer may not be exactly what Scott, and others, want to hear. We shall see......