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| | | Author: | DadsAFOL  | | Posted: | Jan 1, 2011 15:38 | | Subject: | Suggest: Reporting for US Tax Purposes | | Viewed: | 282 times | | Topic: | Suggestions | | Status: | Open | | Vote: | [Yes|No] | |
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| Based on 2011 US Tax law changes regarding the 1099-K for high volume sellers,
and the existing 1099-MISC rules (which most have not been following), we need
some tools to help us manage this.
1. Orders need a check box for "Order used for resale" (vs. order for personal
consumption). Large volume sellers, could specify this as a default preference
for their buying orders.
2. Annual reporting with running totals through the year: A) total sales by calendar
year split by the resale check box, B) and total sales by calendar year by buyer
split by the resale check box. This requires that BrickLink save data for
more than 6 months! I don't think detail items in an order are required,
but definitely order summary level information. C) Buying summary totals by year
by resale check box, for each seller. This would allow buyers to manage their
purchases and stay below $600 if desired.
3. Some new help topics for new sellers that point them to the US requirements
that BrickLink resellers buying more than $600 from a seller are required to
send a 1099-MISC to the seller.
Probably need more tweaks for this, so feel free to add any other tools that
you think will be helpful for tracking US transactions and complying with the
regulations.
-Jason
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| | | | | Author: | drh | | Posted: | Jan 1, 2011 16:24 | | Subject: | Re: Suggest: Reporting for US Tax Purposes | | Viewed: | 84 times | | Topic: | Suggestions | |
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| In Suggestions, DadsAFOL writes:
| | Based on 2011 US Tax law changes regarding the 1099-K for high volume sellers,
and the existing 1099-MISC rules (which most have not been following), we need
some tools to help us manage this.
1. Orders need a check box for "Order used for resale" (vs. order for personal
consumption). Large volume sellers, could specify this as a default preference
for their buying orders.
2. Annual reporting with running totals through the year: A) total sales by calendar
year split by the resale check box, B) and total sales by calendar year by buyer
split by the resale check box. This requires that BrickLink save data for
more than 6 months! I don't think detail items in an order are required,
but definitely order summary level information. C) Buying summary totals by year
by resale check box, for each seller. This would allow buyers to manage their
purchases and stay below $600 if desired.
3. Some new help topics for new sellers that point them to the US requirements
that BrickLink resellers buying more than $600 from a seller are required to
send a 1099-MISC to the seller.
Probably need more tweaks for this, so feel free to add any other tools that
you think will be helpful for tracking US transactions and complying with the
regulations.
-Jason
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Add to this the publishing of a physical address for Bricklink as well as Bricklink's
FEIN, which will be required for those of us who pay more than $600 in fees annually
and deduct it as a business expense.
Regards,
Deanna
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| | | | | | | Author: | cosmicray | | Posted: | Jan 1, 2011 19:08 | | Subject: | Re: Suggest: Reporting for US Tax Purposes | | Viewed: | 49 times | | Topic: | Suggestions | |
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| In Suggestions, drh writes:
| | Add to this the publishing of a physical address for Bricklink as well as Bricklink's
FEIN, which will be required for those of us who pay more than $600 in fees annually
and deduct it as a business expense.
Regards,
Deanna
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I wonder how this works, if a BL seller drops more than $600 USD on a non-US
seller (EU, Canada, or whereever), buying excess from over there to sell here
?
Are the non-US sellers now required to get a FEIN (in order to sell to the US)
?
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| | | | | | | | | Author: | MEModels | | Posted: | Jan 2, 2011 02:29 | | Subject: | Re: Suggest: Reporting for US Tax Purposes | | Viewed: | 47 times | | Topic: | Suggestions | |
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| | | I wonder how this works, if a BL seller drops more than $600 USD on a non-US
seller (EU, Canada, or whereever), buying excess from over there to sell here
?
Are the non-US sellers now required to get a FEIN (in order to sell to the US)
?
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It won't. If the transactions are foreign, no reporting needs to be done.
FEIN = Federal Employer Identification Number. If you're not a US business/resident,
you can't get one because you have no use for one unless you pay taxes to the
US gov't.
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| | | | | Author: | dcarmine | | Posted: | Jan 1, 2011 16:25 | | Subject: | Re: Suggest: Reporting for US Tax Purposes | | Viewed: | 63 times | | Topic: | Suggestions | |
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| In Suggestions, DadsAFOL writes:
| | Based on 2011 US Tax law changes regarding the 1099-K for high volume sellers,
and the existing 1099-MISC rules (which most have not been following), we need
some tools to help us manage this.
1. Orders need a check box for "Order used for resale" (vs. order for personal
consumption). Large volume sellers, could specify this as a default preference
for their buying orders.
2. Annual reporting with running totals through the year: A) total sales by calendar
year split by the resale check box, B) and total sales by calendar year by buyer
split by the resale check box. This requires that BrickLink save data for
more than 6 months! I don't think detail items in an order are required,
but definitely order summary level information. C) Buying summary totals by year
by resale check box, for each seller. This would allow buyers to manage their
purchases and stay below $600 if desired.
3. Some new help topics for new sellers that point them to the US requirements
that BrickLink resellers buying more than $600 from a seller are required to
send a 1099-MISC to the seller.
Probably need more tweaks for this, so feel free to add any other tools that
you think will be helpful for tracking US transactions and complying with the
regulations.
-Jason
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I don't agree with this, Jason. Although it would be nice to have, I think that
this type of data is the responsiblity of each individual, not the site. There
may be other sites that give this information as a "courtesy", but I can't see
how we can ask for this type of service from Admin.
I have to do this for my other business, no site help from my suppliers, so I
think this is the responsibility of each member. The feature to download our
own order details every month should be enough for anyone to create and track
this data themselves without any changes to the site.
JMHO. I am not criticizing your suggestion, just that I thinks it is too much
to ask for. It would certianly be nice, but I doubt the work it will take to
implement will benefit the site owners enough to offer it.
Donna
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| | | | | Author: | Rbobo | | Posted: | Jan 1, 2011 19:31 | | Subject: | Re: Suggest: Reporting for US Tax Purposes | | Viewed: | 44 times | | Topic: | Suggestions | |
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| At the very least, we need order data to be available for at least 13 months.
(Voted yes)
In Suggestions, DadsAFOL writes:
| | Based on 2011 US Tax law changes regarding the 1099-K for high volume sellers,
and the existing 1099-MISC rules (which most have not been following), we need
some tools to help us manage this.
1. Orders need a check box for "Order used for resale" (vs. order for personal
consumption). Large volume sellers, could specify this as a default preference
for their buying orders.
2. Annual reporting with running totals through the year: A) total sales by calendar
year split by the resale check box, B) and total sales by calendar year by buyer
split by the resale check box. This requires that BrickLink save data for
more than 6 months! I don't think detail items in an order are required,
but definitely order summary level information. C) Buying summary totals by year
by resale check box, for each seller. This would allow buyers to manage their
purchases and stay below $600 if desired.
3. Some new help topics for new sellers that point them to the US requirements
that BrickLink resellers buying more than $600 from a seller are required to
send a 1099-MISC to the seller.
Probably need more tweaks for this, so feel free to add any other tools that
you think will be helpful for tracking US transactions and complying with the
regulations.
-Jason
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| | | | | | | Author: | ToriHada | | Posted: | Jan 1, 2011 19:38 | | Subject: | Re: Suggest: Reporting for US Tax Purposes | | Viewed: | 57 times | | Topic: | Suggestions | |
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| In Suggestions, Rbobo writes:
| | At the very least, we need order data to be available for at least 13 months.
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Yes! 13 months minimum, but 15-18 months would be much better.
Also, regarding this suggestion, will sellers be given the ability to block resellers
or business buyers if they don't want to deal with the hassle of 1099s and SSN/EINs?
Thor
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| | | | | | | | | Author: | lepperk | | Posted: | Jan 1, 2011 20:42 | | Subject: | Re: Suggest: Reporting for US Tax Purposes | | Viewed: | 55 times | | Topic: | Suggestions | |
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| In Suggestions, fosterbengoshi writes:
| |
Also, regarding this suggestion, will sellers be given the ability to block resellers
or business buyers if they don't want to deal with the hassle of 1099s and SSN/EINs?
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Whether BrickLink has reporting features to ease the accounting necessary for
the 1099-MISC requirements is one issue. (I personally think that there is no
rush here, especially as there is much talk of revising or repealing the requirements
that are set to go into effect in one year).
A BrickLink buyer's or seller's obligations to file 1099-MISC forms are independent
of that. A BL seller who wants to not have to *file* such forms has to avoid
spending more than $600 (in business expenses) with any one entity. It's less
clear that a BL seller could avoid having to receive such forms (and thus, having
to provide SSN/EIN). Regardless what one puts in one's terms, if a buyer ends
up with more than $600 in purchases over the course of a year, and then wants
to deduct those purchases as business expenses, he or she will be obligated to
send the seller a 1099-MISC.
Unless the law is changed.
Karen
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| | | | | | | | | | | Author: | cosmicray | | Posted: | Jan 1, 2011 22:00 | | Subject: | Re: Suggest: Reporting for US Tax Purposes | | Viewed: | 39 times | | Topic: | Suggestions | |
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| In Suggestions, lepperk writes:
| | A BrickLink buyer's or seller's obligations to file 1099-MISC forms are independent
of that. A BL seller who wants to not have to *file* such forms has to avoid
spending more than $600 (in business expenses) with any one entity. It's less
clear that a BL seller could avoid having to receive such forms (and thus, having
to provide SSN/EIN). Regardless what one puts in one's terms, if a buyer ends
up with more than $600 in purchases over the course of a year, and then wants
to deduct those purchases as business expenses, he or she will be obligated to
send the seller a 1099-MISC.
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Since the earlier flurry of posts, I have had a few thoughts about this ...
The way I see this, there are three (possibly more) types of buyers:
1. The personal use buyer - This buyer is buying for family use only
2. The industrial/business/artist/educator buyer - This buyer is purchasing not
for resale, but to use LEGO elements in a commercial work, or perhaps as an artistic
work, with some intent to resell. This category may also apply to schools and
daycare providers.
3. The pure reseller - This buyer is buying to flip the item (either immediately
or over time) for a profit.
The 1099-MISC would likely be most applicable to #2. That type of buyer would
want to expense the cost of the elements/sets in the current tax year.
The reseller, #3, would not so much expense the sets, as they would carry the
items on their inventory. The cost of the items being used as 'basis' to defer
part of the revenue when the item finally sells on (to the #1, #2, or the next
#3 in the chain). I'm betting that #2 is the one most likely to issue the 1099-MISC.
Any accounting types out there with a view on this ?
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| | | | | | | | | | | | | Author: | poobaloo | | Posted: | Jan 1, 2011 22:14 | | Subject: | Re: Suggest: Reporting for US Tax Purposes | | Viewed: | 90 times | | Topic: | Suggestions | |
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| In Suggestions, cosmicray writes:
| | In Suggestions, lepperk writes:
| | A BrickLink buyer's or seller's obligations to file 1099-MISC forms are independent
of that. A BL seller who wants to not have to *file* such forms has to avoid
spending more than $600 (in business expenses) with any one entity. It's less
clear that a BL seller could avoid having to receive such forms (and thus, having
to provide SSN/EIN). Regardless what one puts in one's terms, if a buyer ends
up with more than $600 in purchases over the course of a year, and then wants
to deduct those purchases as business expenses, he or she will be obligated to
send the seller a 1099-MISC.
|
Since the earlier flurry of posts, I have had a few thoughts about this ...
The way I see this, there are three (possibly more) types of buyers:
1. The personal use buyer - This buyer is buying for family use only
2. The industrial/business/artist/educator buyer - This buyer is purchasing not
for resale, but to use LEGO elements in a commercial work, or perhaps as an artistic
work, with some intent to resell. This category may also apply to schools and
daycare providers.
3. The pure reseller - This buyer is buying to flip the item (either immediately
or over time) for a profit.
The 1099-MISC would likely be most applicable to #2. That type of buyer would
want to expense the cost of the elements/sets in the current tax year.
The reseller, #3, would not so much expense the sets, as they would carry the
items on their inventory. The cost of the items being used as 'basis' to defer
part of the revenue when the item finally sells on (to the #1, #2, or the next
#3 in the chain). I'm betting that #2 is the one most likely to issue the 1099-MISC.
Any accounting types out there with a view on this ?
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Why are you excluding #1 from your logic?
Even a "personal" buyer (me?) buying, COULD call LEGO buying/selling a business,
as I do sell occasional bits and parts. If I want to deduct my LEGO expenses
as a LEGO business, I can. Nothing can stop anyone from doing so. Whether the
IRS likes me calling LEGO trading a business is up to them. So if a buyer who
spends $600 w an establishment wants to send a 1099, they can. As a seller doing
business, you can't refuse this, since you did, after all, accept over $600 in
revenue from this person. You are therefore required to furnish your SSN or
TaxID # of your business if so requested. You are supposed to report your proceeds
anyways.
In other words, you don't have to be buying the set to resell it, to want to
claim it as a deduction. Say you plan to use it in a display, and the display
generates leads, etc etc.
Now, if I personally sell my 4 Airport Shuttles to one buyer for $1000, if they
send me a 1099-misc, I'm not sure what I'd do w that. Sure I got revenue, but
is selling personal assets considered income? I suppose I would have to deduct
what I paid for them, and take the rest as a capital gain, no? Just like as
if I'd bought any other capital 30 years ago (like a stock) and sold it today.
Strange to think of having to do that, since it's just not done for personal
stuff.
Even worse is that sets I bought 30 yrs ago I don't have receipts for. I'm sure
MSRP would suffice.
I guess I see why the govt is doing this. Billions of dollars are probably changing
hands all the time now thanks to Ebay and Paypal making selling ones' stuff easy.
All that money is flowing around untaxed because the govt is not keeping up
w the information age.
-mike
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| | | | | Author: | ToriHada | | Posted: | Jan 1, 2011 19:34 | | Subject: | Re: Suggest: Reporting for US Tax Purposes | | Viewed: | 56 times | | Topic: | Suggestions | |
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| I'm not sure about this and will abstain from voting for the time being. The
one problem I have is that some of my BL orders include items for personal use
and other items for business use. How will BL handle those mixed orders under
this suggestion?
Thor
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| | | | | Author: | brickmover | | Posted: | Jan 1, 2011 23:41 | | Subject: | Re: Suggest: Reporting for US Tax Purposes | | Viewed: | 67 times | | Topic: | Suggestions | |
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| In Suggestions, DadsAFOL writes:
| | Based on 2011 US Tax law changes regarding the 1099-K for high volume sellers,
and the existing 1099-MISC rules (which most have not been following), we need
some tools to help us manage this.
1. Orders need a check box for "Order used for resale" (vs. order for personal
consumption). Large volume sellers, could specify this as a default preference
for their buying orders.
2. Annual reporting with running totals through the year: A) total sales by calendar
year split by the resale check box, B) and total sales by calendar year by buyer
split by the resale check box. This requires that BrickLink save data for
more than 6 months! I don't think detail items in an order are required,
but definitely order summary level information. C) Buying summary totals by year
by resale check box, for each seller. This would allow buyers to manage their
purchases and stay below $600 if desired.
3. Some new help topics for new sellers that point them to the US requirements
that BrickLink resellers buying more than $600 from a seller are required to
send a 1099-MISC to the seller.
Probably need more tweaks for this, so feel free to add any other tools that
you think will be helpful for tracking US transactions and complying with the
regulations.
-Jason
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I have to vote no on this. First, personally I don't think it's anyone else's
business what I decide to use my product for, business use or personal use. I
resell a lot of what I buy and I do it above board as a legit business; should
that make me a sort of "second class" shopper on BL who is banned from half the
stores on the site?
Second, even if it is determined necessary information, the fact remains that
any single purchase of goods does not inherently represent a business or personal
transaction entirely; it can be a mixture of the two. And as far as my purchases
on BL go, it is almost always a mixture of the two.
Any time I buy something for my business, be it inventory like Lego, or heck
even a single thing like a laptop- I can say for example that it is 40% business
use and 60% personal, document it, and claim a 40% deduction rather than all
or nothing. This is very common. This would be difficult to implement on BL and
really annoying to deal with.
Another thing is people can simply change their minds at any time. Someone could
legitimately buy something for personal use but then sometime later decide they
would prefer to liquidate it via their business, particularly if they are a sole
proprietor and all the personal and business finances are mixed together and
filed as a single tax return, shuffling things around like this is easy. So right
there would be a loophole for people to buy for resale if you didn't want to
sell to them. If you sell them something an an end-user, are they prohibited
from selling it off later on and claiming it as income? I can see your concerns
and they make sense, but there is just way too much gray area for something like
this to work.
I mean, just the fact that someone could place orders in a single store over
the course of the year that total, say, $2000 and roughly have the parts in each
of those orders they resold and half they kept. On the flipside, this means the
buyer should be just as concerned. If they want to spend $600 or more, and they
are known to sell as well, then if they plan on keeping much of the stuff for
themselves the last thing they will want is for the seller to assume they are
going to resell it all.
And frankly, if for no other reason, I vote no because the idea that some sellers
here are "resellers" whereas others are somehow just "sellers" of a product they
do not manufacture, seems to come up again and again and again. It seems resellers
here who sell Lego that is strictly acquired off-BrickLink are held in some kind
of special high regard, and any resellers who are talented enough to also sell
some product acquired within-BrickLink are scorned LOL. I don't understand it.
I'm not saying that's in your post. Not at all. But this general idea seems to
pervade the forum on an ongoing basis and I won't support anything that singles
out only some of the BL sellers as resellers. We are all resellers of a product
we don't manufacture. It does seem like what you are asking for is for the arbitrary
break in the chain of reselling to conveniently stop at your level in the chain.
Matt
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| | | | | | | Author: | Lonely_Brick_OH | | Posted: | Jan 1, 2011 23:44 | | Subject: | Re: Suggest: Reporting for US Tax Purposes | | Viewed: | 38 times | | Topic: | Suggestions | |
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| Now here is an argument we have had multiple times.
What is new and what is used.
My thought is all our product is NEW.
Others here disagree.
They say once the box is open, it is a used piece of product.
For customs we use Plastic Toy Brick no definition.
We may go to NEW Plastic Toy Brick or USED Plastic Toy Brick.
Your thoughts on this?
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| | | | | | | | | Author: | MEModels | | Posted: | Jan 2, 2011 02:33 | | Subject: | Re: Suggest: Reporting for US Tax Purposes | | Viewed: | 50 times | | Topic: | Suggestions | |
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| | | We may go to NEW Plastic Toy Brick or USED Plastic Toy Brick.
Your thoughts on this?
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My thoughts:
1. If the product you are selling was purchased on wholesale for retail resale
purposes with no sales tax paid, then it's new.
2. If the product you are selling was purchased at retail for any other purpose
and sales tax was paid (or should have been paid), then it's used.
There are some states that differentiate sales tax based upon whether or not
the sale already had tax paid on it (Wisconsin isn't one of them, but Indiana
is one from my research), thus my logic. 
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USA, California
