Paypal Changes for 2022

@8th-note : They do get itemized. I received already a PayPal 1099-k for 2020 last year. I am in one of those 9 states I mentioned above (see reference below) that already had and have the PayPal reporting requirements for much lower amounts. The 1099-k form had each transaction listed separately with dollar amount and date of transaction.

Are you saying we just ignore the form if we know we did not make any profit?

Say for example, I sold something for $1,000, that I bought a few years back for $2,000. Clearly a loss. It’s reported in that 1099-K form that also gets sent to IRS. What do I do with the form? Do I ignore it? Or do I have to report it in my return, and if so, how? Which schedule? Again, not a business, just an audio enthusiast upgrading.

_————-

• Maryland, Massachusetts, Mississippi, Vermont, and Virginia require a 1099-K to be filed if a TPSO pays a state resident $600 or more during the year.
• Illinois and New Jersey have a $1,000 1099-K threshold (plus, for Illinois, a requirement of at least four transactions).
• Arkansas has a $2,500 threshold.
• Missouri has a $1,200 threshold.

https://ifunny.co/picture/if-you-hit-a-grand-slam-it-s-only-fair-W1xEIVdZ6?s=cl

@tubebuffer : what do you exactly know about US tax system AND baseball?

Please…. Let the adults take this thread on, and tackle the real issue at hand. Please 

@thyname Well, I've about reached the end of my knowledge on this issue. I didn't realize that Paypal itemized all of the transactions.

At this point I'm sort of guessing but here goes. You would normally list any income and account for a 1099 on Schedule C. On this schedule you have the opportunity to deduct expenses. In our case we would deduct the original cost of the item(s).

I'll look forward to the IRS publishing the rules around this change (I live in Washington) but you will have to file before that happens. It's obvious to me that the current rules (I looked them up) were not put together with this type of situation in mind.  Without knowing any more than I know now, here's how I think I will handle it when the time comes.

If my Paypal 1099 only represented audio gear I would lump it all together on one line on Schedule C and show that I had a loss. If the 1099 had more than audio gear then I would break it into categories and put down the profit or loss for each category. You don' need receipts - if the original cost is in the ballpark that is close enough. The main thing would be to account for the total of the 1099 on Schedule C so that your return matches IRS records. Again, I'm speculating, but I think the IRS doesn't want to worry about selling household items at a loss. I just can't believe that the IRS wants to get into the weeds regarding the sale of amps, turntables, used books, old computers, and gramma's dishes. As long as your schedule C matches your 1099's you should be fine. But I've been wrong before......

Well, I've about reached the end of my knowledge on this issue. I didn't realize that Paypal itemized all of the transactions.

That’s OK. I appreciate the effort

You would normally list any income and account for a 1099 on Schedule C. On this schedule you have the opportunity to deduct expenses. In our case we would deduct the original cost of the item(s).

Schedule C is for self employed people. Business. I ran no business. This is my audio hobby.