If i sell a $4000 amp on Ebay/Reverb do i gotta pay IRS ?

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glpg80 said:
“Internal Revenue Code (IRC) Section 6050W states that all US payment processors are required by the Internal Revenue Service (IRS) to provide information to the IRS about certain customers who receive payments for the sale of goods or services…”

Paypal, reverb, eBay, Zelle, Venmo, etc.

There are stipulations but not everyone is free and there are state level controls as discussed above as well.

Cash is king.
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I am well aware of the law, @glpg80

I just think it's ridiculous, corrupt, and invasive.

Therefore the IRS can suck my big fat cock, because I'm going to use every available resource to get around their bullshit.
 
Racerxrated said:
The problem is the PLATFORM that is used to sell….they are taking a cut if it’s Reverb/EBay so they are reporting YOUR sale to the government (state, federal) because your sale dictates their business income. If you use PP gift, on a forum sale you should be fine. But it’s when we use eBay or Scamverb that we get reported to the government.
Here, Craigslist, or FB groups you should be safe.
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Yes. I'm aware.

It's just complete and utter bullshit to charge sales tax indefinitely and perpetually for used items.
 
DanTravis62 said:
I just think it's ridiculous, corrupt, and invasive.
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If I own a hardware store that sells retail as well as used stuff, I have to report all transactions.
Daddy's Junky Music back east started out just as a used gear place. They had to report everything.

It's the same thing.

I've started asking every seller on Reverb if they want to take the transaction off-line.
Most of them do it which keeps everyone but the buyer and seller out of it.
 
Racerxrated said:
Totally agree; and we wouldn’t have to unless we sell to or through a business, who then has to declare the transaction as income.
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Donnie B. said:
If I own a hardware store that sells retail as well as used stuff, I have to report all transactions.
Daddy's Junky Music back east started out just as a used gear place. They had to report everything.

It's the same thing.

I've started asking every seller on Reverb if they want to take the transaction off-line.
Most of them do it which keeps everyone but the buyer and seller out of it.
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Yep. This is why, for high dollar items, I don't use reverb/eBay etc. Most of my high dollar used gear has been from rigtalk, actually.

What I DONT understand, is how the gear community either doesn't understand, or doesn't care, that perpetually charging sales tax on resale is a gross violation of their rights as well as a monumental government overreach.

It's fucking ridiculous.
 
DanTravis62 said:
Yep. This is why, for high dollar items, I don't use reverb/eBay etc. Most of my high dollar used gear has been from rigtalk, actually.

What I DONT understand, is how the gear community either doesn't understand, or doesn't care, that perpetually charging sales tax on resale is a gross violation of their rights as well as a monumental government overreach.

It's fucking ridiculous.
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Agreed. This is why I make sure every transaction is good and go the extra mile to keep my character and credibility as high as possible. Then people don't have to worry about using PP gift with me.

This is a big concern with selling my 67 plexi. It's high dollar and I've had it 30 years... so zero proof of what I paid for it.
 
I am a CPA... but consult your own tax advisor for any situation you may have.. That being said...lets face facts. If the IRS audits you and reviews your paypal activity and sees a bunch of "gifts" in large amounts from various people of no relation all over the country, it's not gonna matter, they will "look through" the transaction and force you to claim it as income anyway. It wouldn't take a whole lot of effort to investigate and determine that at least some of the receipts were actual sale transactions you didn't claim. That's if they get that far what with the pressure/threats of fines or jail time if you persist in lying.
 
mhenson42 said:
I am a CPA... but consult your own tax advisor for any situation you may have.. That being said...lets face facts. If the IRS audits you and reviews your paypal activity and sees a bunch of "gifts" in large amounts from various people of no relation all over the country, it's not gonna matter, they will "look through" the transaction and force you to claim it as income anyway. It wouldn't take a whole lot of effort to investigate and determine that at least some of the receipts were actual sale transactions you didn't claim. That's if they get that far what with the pressure/threats of fines or jail time if you persist in lying.
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I lent them money in person during Covid. They were falling on hard times. It's payback. :sneaky:
 
psychodave said:
I lent them money in person during Covid. They were falling on hard times. It's payback. :sneaky:
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You're so generous! lol

In reality, the odds of the average joe, or Dave in this case, getting audited are fairly low (unless there's self employment income). Resources for audits are constrained and they're gonna go after where the $ is. That being said, the democrat tax proposals have big funding increases for enforcement...that's part of their revenue increase plans
 
DanTravis62 said:
What I DONT understand, is how the gear community either doesn't understand, or doesn't care, that perpetually charging sales tax on resale is a gross violation of their rights as well as a monumental government overreach.
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With all due respect, this is BS. The used gear buying and selling public don't HAVE to pay any taxes.
They don't HAVE to get the government involved. They CHOOSE to involve the government cause
they're lazy and want someone else to do the hard work for them. Or they're impatient and don't want
to have to wait to sell.

Reverb is a privately owned company that has rules to follow if they want to run a business in the US.
If you choose to use Reverb the overhead that comes with it is on YOU. Not the government.

There's plenty of other legitimate reason to be pissed off at Uncle Sam. I don't think this is one of them.
 
Donnie B. said:
With all due respect, this is BS. The used gear buying and selling public don't HAVE to pay any taxes.
They don't HAVE to get the government involved. They CHOOSE to involve the government cause
they're lazy and want someone else to do the hard work for them. Or they're impatient and don't want
to have to wait to sell.

Reverb is a privately owned company that has rules to follow if they want to run a business in the US.
If you choose to use Reverb the overhead that comes with it is on YOU. Not the government.

There's plenty of other legitimate reason to be pissed off at Uncle Sam. I don't think this is one of them.
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Then reverb can hold people responsible for taxes they incur for THEIR services, and THEIR fees - but the actual resale of a used item, whether on consignment or at a garage sale has NEVER been taxed.
 
DanTravis62 said:
Do you pay tax at a garage sale? This crap is ridiculous. The government has NO RIGHT to tax resale of used items. None.
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A garage sale is generally items sold for pennies on the dollar compared to what people paid for them. They would all be considered losses from a tax perspective. If you are turning a profit on gear that would be a capital gains issue. You might never have to worry about it but if you're doing it a lot it might become an issue down the road if you get audited.

Also, people routinely think sales taxes are charged on items when the item is completely irrelevant. The tax is on the transaction.
 
Marykelly said:
A garage sale is generally items sold for pennies on the dollar compared to what people paid for them. They would all be considered losses from a tax perspective. If you are turning a profit on gear that would be a capital gains issue. You might never have to worry about it but if you're doing it a lot it might become an issue down the road if you get audited.
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"Capital gains" for used electronics gear ????????

Good god, you guys.
 
DanTravis62 said:
Then reverb can hold people responsible for taxes they incur for THEIR services, and THEIR fees - but the actual resale of a used item, whether on consignment or at a garage sale has NEVER been taxed.
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I think we're basically saying the same thing but I'm not getting why Reverb or the Government is the bad guy.

If you need a gallon of milk you run to the store and buy it, including paying the state and federal taxes associated
with the business transaction. Whether they show up as a line item on your receipt, or they are rolled into the item
cost doesn't matter. You pay the overhead for the convenience.

If you NEED :rock: that new amp you just saw on Reverb and you click the BUY IT button, the transaction is no
different than it was at 7/11.

I don't see where there is any fault to put on anyone here except the buyer/seller for using the third party.
 
You seem really hung up over what is being sold when the IRS really only cares about the money changing hands. The items are irrelevant.

A guy who sells a Klon he bought for $349 in 2000 for $5000 today is doing better than the stock market in a lot of ways. The government just sees that as gains on an investment.
 
All of this is why I quit selling online (Ebay, Reverb) when the whole internet tax BS started. Sure, it's put a damper on my gear "experimenting" a bit because it makes it hard to buy/sell gear to either create or recoupe funds to roll into new gear . But, I'd 110% rather not deal with crap like this.... ever.
 
@Donnie B. And @Marykelly

Because THEY ALREADY TAXED IT WHEN IT WAS BOUGHT NEW. Whether it's a gallon of milk or a Marshall head.

I don't think either of you understand the intrinsic, terrifying problem with this - if they can tax a used item everytime it changes hands, there is literally nothing they cannot tax.

What if you grab a gallon of milk from your mother? That's according to @Marykelly definition, a "capital gain" now.
 
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