Federal Tax and Consignments for Sports Memorabilia Auctions

[benjoe55]

I read somewhere that ebay does not send sellers a 1099 tax form until they get over $20,000 in sales within a calendar year. Do consignors for sports memorabilia auctions have a similar dollar amount they have to hit before getting a 1099 tax form, or do consignors get a 1099 tax form no matter what they amount they get through their consignments? Thanks.

[cohibasmoker]

I read somewhere that ebay does not send sellers a 1099 tax form until they get over $20,000 in sales within a calendar year. Do consignors for sports memorabilia auctions have a similar dollar amount they have to hit before getting a 1099 tax form, or do consignors get a 1099 tax form no matter what they amount they get through their consignments? Thanks.

Log everything - at the end of the year, turn it over to your accountant and let him/her figure it out - better safe than sorry. Remember, our Government likes to spend our money recklessly so they need all the money they can get.

Just an opinion,

Jim

[Mulligans]

I believe it is Paypal or similar service and as of this Tax year the new Tax Law states 20K AND 200 transactions or more to be sent a 1099. It's listed on their website somewhere??

[trsent]

https://cms.paypal.com/us/cgi-bin/marketingweb?cmd=_render-content&content_ID=marketing_us/IRS6050W

Under the new legislation, we’ll report to the IRS the total payment volume received by US account holders whose payments exceed both of these levels in a calendar year:

$20,000 USD in gross payment volume from sales of goods or services in a single year
200 payments for goods or services in the same year The IRS changes apply to all payment processors, including PayPal and include all sales that occur on or after January 1, 2011. Our goal is to help PayPal sellers understand and comply with the new requirements.
Before your payment volume exceeds the reporting thresholds, you’ll be asked to add your tax ID number, such as a Social Security Number (SSN) or Employer Identification Number (EIN), to your existing account(s), if you don’t already have one on file.

Here is a good article to understand what this means for high volume sellers:

http://www.etsy.com/blog/en/2012/the-paypal-1099-k-dont-fear-it/

[jppopma]

It seems tricky to have the sales documented, but all of the purchases of the items in a grey area. If you have $20,000 in sales through Paypal how will they determine how much of that is profit or loss? In the current market, that $20,000 in sales could have cost you $30,000 to buy (some of which had sales taxes already paid for).

Will the IRS allow you to file the Paypal 1099 and counter it with an investment loss? They should.

This goes right along the lines of states wanting you to declare any items that were purchased outside of the state or online and pay an additional state sales tax on them.

At least it's good to see they are doing good with all of the extra money that are taking from everyone :rolleyes:

[benjoe55]

But what about sports memorabilia auctions beyond ebay--like Grey Flannel, Legendary Auctions, etc. Are consignments to those auction houses held to the same $20k threshold that ebay is, or is everything a consignor sells through those auction houses taxable?

[cohibasmoker]

But what about sports memorabilia auctions beyond ebay--like Grey Flannel, Legendary Auctions, etc. Are consignments to those auction houses held to the same $20k threshold that ebay is, or is everything a consignor sells through those auction houses taxable?

As stated above, turn the information over to your accountant and let him/her figure it out.

"Hope" and "Change" is expensive so it would be best if you pay what you owe.

Jim

[benjoe55]

As stated above, turn the information over to your accountant and let him/her figure it out.

"Hope" and "Change" is expensive so it would be best if you pay what you owe.

Jim

I don't have an acountant. Maybe, someone on the board is an accountant. Others on the board must have consigned stuff and have experience with this issue.

[benjoe55]

I didn't sell or consign anything last year. I've done and sent in my taxes already. The article about ebay got me thinking, and I'm curious about how the big auction houses handle the tax issue. Are there general guidelines for the auction houses, like there seems to be for ebay. Nobody talks about what happens to consignments after the sale and what happens tax-wise. I'm just curious. Surely, people on the board have consgned and sold items via the big auction houses. What happens tax-wise?

[Flamechicken]

Just contact Grey Flannel or Heritage and ask them what's required by the IRS.

[cohibasmoker]

I didn't sell or consign anything last year. I've done and sent in my taxes already. The article about ebay got me thinking, and I'm curious about how the big auction houses handle the tax issue. Are there general guidelines for the auction houses, like there seems to be for ebay. Nobody talks about what happens to consignments after the sale and what happens tax-wise. I'm just curious. Surely, people on the board have consgned and sold items via the big auction houses. What happens tax-wise?

My accountant told me, in the eyes of the IRS, if you sell something and make a profit, its a business. If you sell something and lose money, its a hobby. Doesn't seem fair but there are two (2) things that are definite in life - death and taxes.

Jim