Beginning in January 2022, third-party platforms such as eBay, Etsy, and StockX are now required to report to the IRS when anyone sells $600 or more in goods. The previous rules only applied to sellers with cumulative sales of $20,000 or more in at least 200 transactions, but now those generating much smaller revenues will receive a 1099-K form to report their income. Technically speaking, the obligation to report such revenue hasn’t changed. The difference comes in increased scrutiny from the IRS regarding online sales, and filing your taxes without noting sales on platforms like eBay, StockX, and GOAT is more likely to cause issues because the agency has already been tipped off on your activity.
The Key:
To give an example of just how easy it is to hit the $600 threshold for sneaker sales, just two or three pairs of Air Jordans sold over the course of the year could push you over that figure. Your actual profit may be just a fraction of that, however, so you’d want to keep track of how much you originally spent on each pair of sneakers and include those figures in your filing. You can also write off other costs of doing business, such as packaging and shipping expenses, as well as any mileage you may have accrued on your vehicle while engaging in business activities.
