So it's no surprise that the IRS doesn't view all sellers alike in the online marketplace. You may not have to pay tax at all if you are essentially hosting an online garage sale, but if you run your eBay account more like a business, you should be reporting your sales to the IRS. Not every eBay sale is subject to income tax , but most are.

If you use the site to get rid of household articles you've used in the past, you may qualify for "occasional garage or yard sale" treatment. According to the IRS, if your online auction sales are the Internet equivalent of an occasional garage or yard sale, you generally do not have to report income from those sales.

Assuming that you originally bought the used items for more money than you are selling them for, you don't have to report the income received from the eBay sale.

Do You Have to Claim eBay Sales on Taxes? | omotohu.web.fc2.com

If you and the IRS classify your eBay sales as a hobby , you'll have to report the income. Your income is reported on Form and your expenses are an itemize deduction on Schedule A. However, you won't be able to use a loss from hobby sales to reduce other income. This can be important if you make money in other activities.

If your eBay activities are considered a business , you can use your loss as a deduction to reduce your gardening income, so:. If your eBay activities are a hobby , you cannot use a loss to reduce your gardening income. Distinguishing between a hobby and a business is not an exact science.

The IRS looks to many factors including:. If you sell and buy articles on eBay in order to earn money, the IRS will likely classify your sales activities as a business. This means you will have to report net income from eBay sales. Report your total gross income on Schedule C , then reduce it to net income by subtracting the amounts you spent for allowable business-related expenses.

The only tax deductions you can use to reduce your gross eBay sales income are those authorized by the IRS, but you'll have quite a few to choose from.

Consider whether you qualify for:. If you're still unsure if something is deductible, check out a more comprehensive list of common small business expenses.

Perfect for independent contractors and businesses. Find more tax deductions so you can keep more of the money you earn with TurboTax Self-Employed.

Sales Tax for Online Sellers.

What Online Business Owners Should Know About IRS Form K. A Tax Guide for Solopreneurs: Top Tax Write-offs for the Self-Employed. Tax Tips for Bloggers. Filing IRS Form W Tips to Reduce Self-Employment Taxes. Self-Employment Tax Deductions on Cell Phones. Beginner's Tax Guide for the Self-Employed.

Estimate your tax refund and avoid any surprises. Adjust your W-4 for a bigger refund or paycheck. Enter your annual expenses to estimate your tax savings. Learn who you can claim as a dependent on your tax return. Turn your charitable donations into big deductions. Get a personalized list of the tax documents you'll need. Find out what you're eligible to claim on your tax return. Find your tax bracket to make better financial decisions.

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Trademark Notices About Intuit Search Intuit Jobs Press By accessing and using this page you agree to the Terms and Conditions. Skip To Main Content. A Tax Filing Factsheet for eBay Sellers Updated for Tax Year Not All eBay Sales are subject to income tax Not every eBay sale is subject to income tax , but most are.

Hobby sales must be reported If you and the IRS classify your eBay sales as a hobby , you'll have to report the income.

If your eBay activities are considered a business , you can use your loss as a deduction to reduce your gardening income, so: The IRS looks to many factors including: Using eBay to make profits is a business If you sell and buy articles on eBay in order to earn money, the IRS will likely classify your sales activities as a business. Business tax deductions for eBay sellers The only tax deductions you can use to reduce your gross eBay sales income are those authorized by the IRS, but you'll have quite a few to choose from.

Consider whether you qualify for: Costs to purchase or fix up the items sold Deductions for business use of your vehicle , either actual expenses or the standard mileage rate deduction, 54 cents a mile in Advertising expenses Apportioned amount of phone and Internet charges related to your eBay business If you're still unsure if something is deductible, check out a more comprehensive list of common small business expenses.

Perfect for independent contractors and businesses Find more tax deductions so you can keep more of the money you earn with TurboTax Self-Employed.

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How much can I sell on eBay before I have to pay tax? - Birmingham Mail

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HMRC targets Etsy, eBay and Gumtree sellers – but when is your hobby taxable? - Telegraph

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