Question for anyone who has sold anything expensize on ebay

[Colleen A.]

A friend of mine, who works as a Disney training coordinator for 7 years in WDW, asked me to list some of her CM only items on ebay. She is giving me a 10 - 15% commision on any item that sells. One item, in particular, is a Partners in Excellence award. It is a solid bronze reproduction of the Partners statue. (I have no clue as to WHY she would want to sell this gorgeous piece! ) She asked me set a reserve price of $4000! This is where a potential problem might occur. IF this sells for that price, am I going to need to claim this as income next tax year?! I don't see this problem happening with her CM only pins but something this large....any idea?

Thanks for any help!!

Colleen

 

[JoniGirl]

I have been selling on Ebay and Yahoo for over a year. The most expensive single item I have sold was only $450, but I have made more than $4000 for the year. I did not recieve a 1090 on it, nor has Ebay or Yahoo asked for my SSN - which they would need to report the income.

I don't think it will be a problem, but if you are concerned - contact EBay and ask them. Or use Yahoo Auctions- they are cheaper and have less rules!

Good luck!

 

[DMRick]

Most eBayers who sell for others, get a little more than what you mentioned. eBay is a lot of work. Be sure to decide who will pay the fees (if it sells or doesn't), and who is reponsible for packing and shipping. It's your feedback!

eBay is a venue only. They do not keep track for you of your profits, etc. However, they do open their records freely to the IRS, and they will tell you that, if you ask. If you don't want to claim the income, I would suggest you have your friend set up her own eBay account, and you sell from there. Keep track of your expenses, since your income from her is traxable income. You might want to set up a schedule C, for self employment, so you can take off your expenses. Otherwise, this would go on your income tax as misc income..but then you can't take off your expenses, so your tax would be higher.

While the IRS doesn't often bother the "garage sale" seller (not saying they never do, because sometimes they do), they certainly have gotten interested in the amoutns you are talking about. Keep in mind, that although the IRS usually only goes back 7 years, if you have an IRS problem...in the cases of fraud (withholding income) they can go back forever.

I would not sell something (just my own opinion) of that value on Yahoo...they just don't have the buyers at this time (their counts are wayyy down), and you would still have the same IRS rules to follow.

Just as a PS, eBay has just raised the prices (not in effect yet) to put items up at a reserve..be sure you check your new fee schedule before setting unrealistic reserves..you pay if it doesn't sell for at least your reserve. If your friend sets all the prices too high, and you are working on commison, you will be doing a lot of work for nothing.

Good luck in this venture!