It is illegal not to report your income to the Internal Revenue Service.
Any income, even money from selling items on eBay, could be subject to taxes.
Even if you don’t claim the income when you file your annual taxes, eBay will submit a Form 1099, reporting your income to the IRS.
Do you have to pay taxes if you sell on eBay?
Not All eBay Sales are subject to income tax
Not every eBay sale is subject to income tax, but most are. According to the IRS, if your online auction sales are the Internet equivalent of an occasional garage or yard sale, you generally do not have to report income from those sales.
Is selling personal items considered income?
If you sell something created or acquired as a hobby online, the profit you earn is taxable income that is supposed to be reported on your tax return. Under prior law, hobbyists could claim as an itemized deduction their hobby-related expenses up to the amount of income the hobby earned during the year.
How much can you sell before paying tax?
It depends on how long you owned and lived in the home before the sale and how much profit you made. If you owned and lived in the place for two of the five years before the sale, then up to $250,000 of profit is tax-free. If you are married and file a joint return, the tax-free amount doubles to $500,000.
Do you get a 1099 from eBay?
eBay does not issue 1099’s since they never touch or see your payments. PayPal issues 1099’s as required by the IRS to those sellers who have sold at least $20,000 worth to at least 200 different customers, otherwise you are on your own.