Business Opportunities Weblog

June 29, 2006 by Ty Tribble | 0 Comments

 My Hobby

Q: I made extra money selling things on eBay last year. These
were items I picked up at yardsales mostly. My husband says I
am responsible for paying income tax on the money I made, but
I disagree. This is just my hobby, not a business. What do you
think?
– Gladys A.

A: With so many people selling on eBay these days this is a
question I get all the time. To many eBay sellers the thought of
running an actual business is about as appealing as getting
negative feedback, so they go out of their way to convince
themselves that selling on eBay is really “just a hobby” and
therefore, should not be susceptible to income tax laws.

While you might think selling on eBay is just a hobby and the
extra money you’re making is not reportable as income, depending
on the circumstances, the IRS just might disagree with you.

The IRS rules are clear: you must pay taxes on all personal and
business income and that includes money you make selling on eBay.

In its most basic sense, the IRS rules mean that if you buy a
vase at a garage sale for $10 and sell it on eBay (or elsewhere)
for $20 you made a $10 profit and therefore must report it as
income and pay Uncle Sam his fair share.

In reality, if you are a casual seller who only sells a few
items on eBay every now and then it’s doubtful the IRS is going
to lose much sleep over the few bucks you make.

In Uncategorized | 0 Comments
Tags: Ebay & Online Auctions