The legalities of selling on eBay...

[azo313]

I hope this is the right forum:

Can someone elaborate on this a bit?

Is it legal to purchase items from retail stores and then re-sell them on eBay? (without reporting income)

Lets say, 10 or 20 expensive things a month (several hundred a piece). Or even hundreds of non-expensive items (several dollars a piece).

What are the legal matters involved here in regards to making income.

I do know that you do not charge sales tax for other states (only your own)... but would you even have to pay/report sales tax of your own state? Because you do not need a reseller ID number to sell on eBay.

Also, income in general (forget about sales tax)... do you have to report that if you constantly sell on eBay?

 

[bonsai]

Sure it would be legal to buy most anything and resell on eBay.

Your "report income" question is actually translates more to and "Income Tax, State Tax" question.

Your best bet would be to pose the question to your accountant, and if you don't have one, find one. He or she will know your state laws best and this person would be helpful in filing your "now mixed" tax report at the end of the year.

It would be a bad move, I think, to create a big income of any sort and hide it. Im pretty sure that anything over $600 should be legally reported on your income tax, from which you pay a certain % of based on your tax bracket and if you are a business, usually state self employment tax of some sort.

All depends on whether or not you are trying to start a very viable business on eBay or simply sell a few items.

Accountant for sure.

He / She will also inform you about your local sales tax issues, I would thin each state has a few different ways of handling it all.

I would further disagree with your statement about "not needing a reseller cert to sell on eBay" (well is true for the average joe, selling like a garage sale) but if you plan on a business of any sort, selling items of any sort for the sole purpose of gaining profit, you need the reseller id to sell.... ANYWHERE.. eBay not being germane.

If you just get a DBA, then your social will be used as your reseller number most times. You report taxes under that number as well. Once you get a DBA, you gotta then let the local tax office know who you are and they send a slip, with your social on it. Then you have to report taxes every quarter (even if you sold nothing), and probably not a bad to idea to pay some income tax each quarter too.

Yet, you could hold a garage sale often and sporadicaly, without needing a reseller certificate, or collect sales tax..
Accountant advice, and you decide what you want to be, a garage saler or a business. Good news on the business side, you get count everything you BUY directly off your taxes at the end of the year.

Good luck

PS Money in and money out, escpecially through eBay, is insanely easy to track. You would make a mistake if you churned a fistful of cash and bought a big house on a low salary.