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I paid 12 grand for a racing bicycle and about to sell it for 2500 many years later. Am I going to report that as income? Heck no. It will be a cash transaction. The Govt got my money on the first transaction.
You would not owe taxes on this transaction because you did not make a profit.
FYI this rule has always been in place but you had to self-report if you hit the threshold now these companies have to send out the tax forms to you.
Yes this rule has been in place since 1954. But it has NOT only been the rule, the amount in 1954 was $600 and has not changed in the 60+ years since. In 2022 dollars that would be about $6,600 if this amount kept up with inflation.
You would not owe taxes on this transaction because you did not make a profit.
I'm still unclear on what the rules are for proof.
The sale will be clearly documented by the transaction service being used, but how does the seller prove the original purchase price if they don't have the receipt.
And if they don't have the receipt, is the whole transaction considered taxable?
You would not owe taxes on this transaction because you did not make a profit.
And what if they no longer have the original receipt showing they actually took a loss? What if this was something they bought 10-15 years ago? Do you really think that the IRS will "trust" you that the loss is being reported correctly?
I paid 12 grand for a racing bicycle and about to sell it for 2500 many years later. Am I going to report that as income? Heck no. It will be a cash transaction. The Govt got my money on the first transaction.
Think about how many times a car get taxed. At some point the Govt gets more than what the car sold for new as every person buying that used car get hosed.
Which literally is no different at all than before. You were always required to report income. In this case you bought something for 12,000 and years later sold it for 2,500 so you didn't report it. Now you bought something for 12,000 and years alter sold it for 2,5000 and you are required to report that. Either way you don't pay tax as you made no income. The difference is now you're just required to report it. Before since you didn't make income you weren't required to report it.
But let's say you bought the bicycle last week for 1,200 and sold it today for 2,500. In the past you were required to report it but a number of people running businesses were not doing so. Now they're required to report the sale for 2,500. They can lie on their taxes and say they bought it last week for 12,000 rather than 1,200 last week. In effect that's what they were always doing before, lying by omission, but now they need to report it. It just makes it easier to catch people committing tax fraud is all.
No it doesn't. You only need to report personal items that you sold if they were sold for more than what you originally paid.
In your world, I could sell a stock I own for 10x what I paid for it and owe no taxes. Is that right?
None of this is new except that now you get a form generated instead of having to input everything manually based on your own bookkeeping.
Quote:
Originally Posted by zentropa
You would not owe taxes on this transaction because you did not make a profit.
And a lot of people who will be getting those forms do not know this or will not want to go through the hassle of proving to the IRS that the item was not income. So they will just include it with everything else reported as income. The IRS knows this. They know that it will allow the government to get its greedy hands on just a bit more of the serf's earnings. The entire system is just soft slavery. You labor XXX hours of your day for the government. And now you get to pay even more taxes on hitherto non-taxed items because the hassle of getting out of paying it is just not worth the effort.
Quote:
Originally Posted by Malloric
Which literally is no different at all than before. You were always required to report income. In this case you bought something for 12,000 and years later sold it for 2,500 so you didn't report it. Now you bought something for 12,000 and years alter sold it for 2,5000 and you are required to report that. Either way you don't pay tax as you made no income. The difference is now you're just required to report it. Before since you didn't make income you weren't required to report it.
And what happens if you don't have receipts from twenty years ago? Or bought it used from an individual who didn't give you a receipt?
The new norm is going to be just to dump your unwanted items alongside a highway somewhere and take the loss. Or burn it in your back yard and add to your carbon footprint. The government is great at creating waste. In fact, that's about all they create.
you sell a piece of furniture, or a piece of jewelry, or any item for $600.
you are supposed to report that income, and now Paypal etal will send you the form.
You will get a 1099 for the sale(along with any other sales you make on a given platform), but once the tax forms come out, I bet there will be lines for
1099 MISC(or whatever) reported amount
Less: sale of personal items
Total to add to Adjusted Gross Income
Quote:
Originally Posted by Goofball86
This doesn't set the case for the Dems that they only go after the 1 percent or wealthy tax cheats. No wonder they need those 80k extra IRS agents.
The 80k staffers are need to replace staffers that are retiring over the next 10 years
Quote:
Originally Posted by bluesjuke
The rule also penalizes people when selling their personal possessions.
Holy tyrannical revenuers Batman!
No, it doesn't. You might get a 1099 for selling personal possessions, but there will likely be a line to subtract those amounts from the total.
Quote:
Originally Posted by ChrisC
I sold a guitar during the year for $1100. That guitar was purchased NEW by me in the past for $1800. Tell me how this is considered "income"?
If the IRS thinks I'm going to pay income tax on it, they can kiss off. All they get from me is the middle finger in that case. It is NOT income. I LOST money on it. And the money I used to buy it in the first place was ALREADY TAXED. Jesus, the feds make some STUPID rules.
Exactly right.
In the above case, I didn't have much choice--it's the only time I've used Paypal all year. And when the dems ban cash, I'll use gold. And when the dems ban gold, I'll barter. And when the dems ban barter, they can just come after me, execute me and burn my home down. I'm NOT paying income tax on non-income.
You won't owe any taxes on that sale, since you didn't make a profit, and t was sale of a personal possession
Quote:
Originally Posted by FrankNSense
And what if they no longer have the original receipt showing they actually took a loss? What if this was something they bought 10-15 years ago? Do you really think that the IRS will "trust" you that the loss is being reported correctly?
Yes, as long as the amounts are reasonable.
You can blame this on all the people who are making a lot of money on selling stuff on eBay, driving for Uber, etc. They;'ve been bad about reporting their income correctly, and now they will have to report it.
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