Regular Ebay Flippers and Taxes

[canvas01]

I have started buying and flipping for profit more regulary on ebay recently and I'm worried about taxes. I've been hearing for awhile that the IRS is going to crack down on ebay sellers and with their access to credit card spending totals versus income statements its probably not hard for them to figure out who flips on ebay.

It seems like a huge chore to save every single receipt and track every penny, but is this what you need to do in case of an audit? Can your gross ebay sales be taxed if you can't provide proof of deductions (item cost, listing fees, etc.)

What do you guys do?

 

[el es dee]

If your really going to get serious about this, I would suggest you form an LLC to protect yourself with.

 

[Tarmac]

What's the legal distinction between someone who just buys a lot of stuff and sells it when they don't want it anymore (many rich people or their kids do this on ebay) and someone who does it for a living?

 

[West24]

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[Dakota rube]

^^that is some next level spam **** there...

these F***ers are getting merciless.

 

[Bradford]

I killed the spammer.

 

[crazyquik]

There is some legal writers now writing about the potential for taxation of "virtual" assets like Brooks Brothers points, frequent flier miles, and World of Warcraft . . . well whatever you can earn, spend, and sell in WoW.

 

[grimslade]

Originally Posted by Tarmac

What's the legal distinction between someone who just buys a lot of stuff and sells it when they don't want it anymore (many rich people or their kids do this on ebay) and someone who does it for a living?

Step 3: Profits!