1099 basics for ebay sellers

Many eBay sellers wonder why they don’t receive a Form 1099-MISC from eBay at the end of the year.  EBay is only the facilitator of the auction, therefore they do not provide 1099s to sellers. 

However, just because you don’t receive a 1099 does not mean your eBay sales are not subject to income tax.  You must report all income, whether you receive a 1099 or not.  For more information on reporting income, please see ‘Are you required to report your eBay profits?’.

On the other hand, as an eBay seller, you may be required to file 1099 forms if you hire someone to help in your business.  The general rule is that if you pay more than $600 to someone who is not considered your employee, then you are required to provide them a 1099-MISC form. 

If you use QuickBooks, there is a feature to help you prepare 1099-MISC forms included.  Otherwise, I recommend the website www.filetaxes.com for 1099s.

For more great eBay tax tips, please read our free special report, Tax Tips for eBay Sellers.

Tags: ebay tax, form 1099, independent contractor ebay

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