pettrix

Starting Jan 01st, 2022, Facebook Marketplace will require your social security number as they will begin reporting any sales over $500 to the IRS. If you don't give a SS#, you can't post anymore

I find that REALLY lame but opinion aside, will this site do the same for the For Sale in Parts and For Sale in Cars? The claim is that any profit made, the seller must pay taxes for online sales.

OLDSter Ralph

Ask Facebook Marketplace the question. They would be the the people to answer your question.

PatL

Sales revenue - cost of goods & expenses = profit. FB does not know about the vendor's second two items. Based on what you are saying it sounds like they will be issuing 1099's to vendors with transactions greater than $500. Keep track of your costs...……...

VI Cutty

Where is the official announcement on this?

Not being in the US, I couldn't really give a rip about the IRS but if the initiative is more international then it would certainly affect some of my decisions. I find FB to be my least favorite listing place already and there are other options available. If they go ahead with something like this I think we'll see marketplace become overrun with commercial vendors and bereft of any casual sellers. Something else will replace it and that's where you'll find me.

Unless there is a federal or state law requiring it, I don't think you'll see classified listings in forums like this following suit.

Edit: Just read a bit more about it. First, it only applies in the US. Second, it seems to only apply to sellers who setup a Shop which makes the sales and collects payment through Facebook. If you're just selling a couple of parts and collecting payment through other means then it doesn't generally apply to you and you won't get a form from FB. Of course I never tell FB if I've sold a listed item through FB or whether the purchaser found it elsewhere.

fleming442

If it's a sale between 2 consenting parties, why would they be able to even get involved? Now, if you're messaging through them, talking prices, then they facilitated the sale. Take it off social media and exchange email addresses. It works on eBay, too.

armbrbr

I like not paying taxes as much as anyone. I would guess this is just more of the Taxman putting pressure on Facebook. You're supposed to pay sales taxes on every online transaction after all.

Next, Facebook will probably charge the seller a "collection fee" for making it easier to collect the tax.

You've been adding that to you taxes every year already, haven't you? <sarc>

69HO43

It's all courtesy of the Brandonistas, thank you very much.

First off, you technically must report anything you sell to someone else at a profit, regardless if anyone is watching or not. That's considered income. Full stop.

Paypal, eBay, FB, and other third-party "money laundering" places (according to the Brandonistas) will be collecting information next Saturday for your 1099-K above $600 per year total. And potentially even YOUR BANK if the U.S. Treasury gets their way...essentially, will be treating/accusing everyone as being a tax-cheat first, and then you'll need to prove you're not, by snooping in on their bank transaction totals in or out of a bank account of $10K or more. Which, with inflation, probably won't take very long for most people. We'll see. There's going to be more questions than answers I'm afraid.

From what I read about the FB Marketplace, the $500 requirement is below the threshold of $600 federal reporting requirement. Also, the money has to be sent through FB Marketplace for them to be able to account for the sale, so they must play the role of middleman. If they're not involved in collecting/sending any money, they don't have a dog in the hunt, thus no 1099-K from them. Not sure how it works because I don't use FB. Also, you must only provide your last 4 of the SSN until you reach $499 in sales through them. THEN, you must provide your full SSN or ITN. If not, that's when they'll pull the rug out from under you.

fleming442

Unfortunately, online sales have pretty much destroyed the "trust" (for lack of a better word) between buyers and sellers. Misrepresented items, flaky buyers, no shows, no pays, etc abound. The e-commerce transactions through PayPal, eBay, zelle, etc. all provide a small level of security ensuring that payment doesn't send until goods are received. Otherwise, it's a Catch 22.
Anything under $600 be considered a "gift" in the feds eyes, but in this day of electronic transfers, there's no real way to hide transactions short of face to face, cash in hand.

don71

My understanding is the federal govt. earlier this year, moved the threshold from $20,000 to $600 and has to be reported if you made a profit. Its called a 1099k.

Its only a problem if you get audited. You don't want to attract attention. Then you simply have to prove you didn't make a profit on the object. That is why you keep receipts and record this kind of stuff.

Its not really a big deal to me as I don't sell stuff. I'll admit this could hurt the little guy like the "cottage industry" that sells a number of things and makes profit and wants to obey the law.

For bigger companies this is business as usual. All the on line buy and sell sites are doing this all ready.

We had this same discussion when ebay started reporting these a couple of years ago in response to the Way Fair Act. This is a continuation of that.

Perhaps IB (the owner) of this site is will have a response to the original question at some point. Worst case you'll have to register as a seller, submit your SS# or tax identifier number so they can file/report the 1099. You know... to keep things legal.

oldcutlass

This site does not record sales or purchases. I don't see a problem here.

GN1220

It should be a big deal to all of us because it is not only you selling something over $600 it's ANY transaction over $600 associated with your account that they want to pass. Withdraw $700 to give to your child, the bank is required to notify the IRS. Deposit $610 from a garage sale, notify the IRS. Pull $1,000 out to stick in your safe at home, notify the IRS. This is truly frightening

coppercutlass

This will bring trading times back real fast !!!! I miss swap meets. Everything is sold through market place now or apps. They are a joke. We used to have many swap meets in the area now maybe 2 per winter.

69HO43

If the site is not acting as a broker, i.e., handling the invoicing and money transfers after the "sale", then no, there's no problem, and no 1099-K form to be filed, regardless of the amount. But if you sold $1,000 part to someone, and you received it via PayPal goods/services, regardless where you bought it, you'll get a 1099-K from PayPal because they handled the money for you.

fleming442

I doubt it. People, in general, are too lazy to do anything about anything. They'll just pay Uncle Sam whatever he asks for.

droldsmorland

We really are in a sad fat bloated malaize Orwellian state of affairs. Nothing should surprise anyone...anymore.

I have a solution for the TP shortage,,,1099

Cash is still king but getting tougher to spend...sad.

H/o

I did hear this news. Will this be a new thing on Ebay and other platforms like that because I wouldn't this forum would implement it.

Tri-Carb

We are very lucky here. USA taxes relative to the rest of the industrialized world are low:

How do US taxes compare internationally? | Tax Policy Center

69HO43

Just wait.

wr1970

Um ss #'s are private ! They are not to be used as I'd. It is illegal for them to even ask as they are not receiving money. Just list everything as one dollar. Then give out a email or contact number to buyer. Game over.

GN1220

Our medical history is supposed to be private but look how that's going.

wr1970

Time for everyone to take them to court!

H/o

I'm actually wondering if everything will switch to another platform and if so what are some others besides maybe craigslist. Do you or anyone else here know?

twilightblue28A

The law applies not only to Facebook, but all third party apps including PayPal, Venmo and Cash App.

​​​​​​Revenue six-hundred ($600.00) dollars or greater will be reported to the Internal Revenue Service. (Similar to a 1099).

VI Cutty

There are two "sides" of Marketplace. The first is the part where people list a single item for sale and the transaction is handled and completed directly between the two parties. This law doesn't seem to pertain to these transactions, at least not yet.

The other side is where the commercial vendors live. Here, they setup "shops" with inventory items that can be purchased online through the Facebook shop. These are the transactions that can be accurately tracked and reported by Facebook. They may be $20 or $30 items, but someone selling tshirts through their Shop would sell in excess of $600 annually and fall under the reporting requirements.

I have a dormant shop for my business, but don't recall ever having to provide my Social Insurance Number (Canadian equivalent to the SSN). Can 1099k be issued without an SSN?

Up in Canada we have epay (yuck), Kijiji, Usedeverywhere and a few others. They all seem to have allowed themselves to be taken over by prolific spammy commercial vendors rendering searches or casual browsing for used parts almost useless. I think Facebook has over complicated their system deciding what one can or can't do with their shop, business account, personal account and using AI that locks people out of their business accounts for unexplained reasons which is going to lead to a fall from favour before long. The other BST sites are no longer person to person they way they were 5 years ago. Maybe it's time to setup a "proper" BST system lol.

twilightblue28A

Please re-read my post. The threshold is $600.00 for third party apps such as Venmo, PayPal, Cash app in addition to Facebook. The law applies to United States Taxpayers. I am not familiar with other countries laws.

fleming442

PayPal owns Venmo

VI Cutty

I realize this only applies in the US for now, but Canada's governments are quick to pickup on ideas for how to grab more tax money from us by watching what happens south of the border...so I wouldn't be surprised to see something similar up here. I looked the US announcement up back when this topic first emerged, and my take away from it was that it applies to "sellers who setup a Shop which makes the sales and collects payment through Facebook." (or similar site) The key being collecting payment through Facebook, which makes the transaction trackable and reportable unlike me selling a hood to Frank who shows up on my doorstep with $100 cash in hand. Because there is no transaction record (or proof), all one needs to do is respond "Didn't sell" or "Didn't sell on FB". Different story when the funds flow through FB, PP or any of the other payment processors/marketplaces.

Of course that might change down the road, nor does it change existing laws about what we're "supposed" to do but the vast majority don't.

All in all, it's a typical method for governments to increase tax revenues by expanding the scope of existing taxes so they can proudly claim they haven't introduced any NEW taxes. Buggers.

twilightblue28A

Again, Federal Law is that revenue $600.00 or greater will be reported to the Internal Revenue Service (IRS). I am knowledgeable about Federal Law.
If you dispute the law, contact the Internal Revenue Service (IRS). IRS employees are employed to service the taxpayer!
I am not in the practice of speculating.

Tri-Carb

Here Are the Tax Changes Coming to Venmo, Cash App, PayPal and Other Apps – Forbes Advisor



Press Release: New U.S. Tax Reporting Requirements: Your Questions Answered (paypal-corp.com)

66-3X2 442

The part about banks isn't being enforced @ this point in time. The banks are fighting this very hard because it's a nightmare for them.Doing some research I found the if you use paypal/venmo etc. only goods and services are being taxed,friends and family is not. This was snuck in in the American Recue Act bill the communist passed back in the first of the year.

69HO43

The problem you'll find with paypal is that they will limit friends and family transactions if you get too many of them. They're not stupid. They can, and have done it to others, although I've not had them limit me because I don't use it often.

twilightblue28A

What part about banks isn't enforced. I don't understand. Please clarify.

66-3X2 442

I'm quoting a friend who is a bank President. He told me it's not being enforced @ this time. When you research it it doesn't say anything about banks reporting, transactions over $600. It's only the money transfer sites that's required to report.

66-3X2 442

Don't shoot the messenger. It says that if it's not for goods or services it's not being reported. If you don't agree, contact your local communist representative.

no1oldsfan

Screw fakebook. Like they don't know every single move you make already? You will Never see me there.

twilightblue28A

Your bank president needs to understand that a bank is not a third party. The US Government sees everything going in and out of a given account under examination!

twilightblue28A

Go ahead and believe what you read! Forty-five thousand ($45,000) dollars passes through "friends and family" and the IRS looks the other way......

twilightblue28A

The law applies to the tax year 2022, You will be issued a form 1099-K. The same principal applies as form 1099. You are required to report revenue $600.00 or greater.

66-3X2 442

That's not the point. I'm just saying what the current law says. I would imagine a transaction of that amount would most certainly draw scrutiny. As to the bank being required to report any transaction over $600,are you saying they are required to do so now?

wr1970

NO! the Bank limit at credit unions is $9 k daily. I was told this by my credit union. Any withdraw over 9k they are required. Didn't tell me what is reported for deposit.