1099-K Changes Coming in 2022

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Mist

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In your scenario, it's still as you say side money and making a profit. My example would be Bought a gun for 1k new, sell it for 700 later, upgraded a telescope, sold old one.

Vs, I can understand say i have my salt tank. I continuously grow and clip coal for sale is certainly side money profit even if it doesn't cover the costs of my aquarium.


Or just rabble rabble taxation is theft, become ungovernable.
Under the old IRS definitions, for an expensive hobby like magic cards you could just consider that your lifetime year-to-year costs of participating in the hobby on average offset whatever you made from the hobby. As long as you didn't operate an actual business like a physical or digital storefront, the IRS would just consider it all hobby income. That changed after 2017.
 

AladainAF

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You used to just be able to say that your hobby expenses cancelled out your hobby income, but that changed after 2017, aka not "the libs fault."

This is when I stopped bothering to sell magic cards for extra money. This was part of the Trump tax "cuts" when they increased the standard deduction but removed all sorts of other deductions.


View attachment 389111

You can still deduct hobby expenses equal to your hobby income, so long as your hobby income is no more than 2% of your AGI.
 

Mist

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You can still deduct hobby expenses equal to your hobby income, so long as your hobby income is no more than 2% of your AGI.
Only if you itemize, right?

EDIT: Actually, no, you're wrong:

1640124385595.png


Unless you mean using your hobby expenses as the sole contributor to your miscellaneous deduction.
 

Asshat wormie

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The fuck is hobby income? Report it as just income and deduct expenses.
 
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Koushirou

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Probably a dumb question, but how does this affect if I sell some old shit at a yard sale and I get paid via PayPal? Does that count as this hobby expense shit or just straight income? Always thought that you couldn’t tax old shit again because sales tax was already paid on it, but I don’t know how this shit works.
 

LachiusTZ

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Selling old shit is prolly going to end up a basis issue...

Which, since people don't depreciate personal items, the basis is usually cost.

You are required to report the income. But it's usually at a loss, which you get to eat because reasons.

That removal of hobby expense struck me, didn't realize that got removed
 

Mist

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The fuck is hobby income? Report it as just income and deduct expenses.
If it's not a registered business the IRS does not allow you to deduct expenses other than the miscellaneous deduction.
 

The_Black_Log Foler

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What the fuck? I have to report shit I sell on eBay now? Fucks sake
 

Mist

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What the fuck? I have to report shit I sell on eBay now? Fucks sake
You don't have to report it, PayPal will report it for you...

You just have to actually pay it now lol.
 
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The_Black_Log Foler

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You don't have to report it, PayPal will report it for you...

You just have to actually pay it now lol.
God damnit. I don’t remember all the random shit I sell. Fuck the gov.
 

whoo

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Bro you sold that for $1.
Build back idiot bill has mandatory banking transaction reporting to the IRS if the account transacts more than $600 in a year. Currently, it's to report a single transaction of $10k or more, or multiple "suspicious" varied transactions that total more than 10k in a month (anti-structuring).

BBB may be dead at the moment, but government wanting to track 100% of your transactions for tax *and* to make sure you don't spend too much on the "wrong causes" is so close to happening it's crazy.

And nobody cares really... Apathy everywhere
 
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AladainAF

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Only if you itemize, right?

EDIT: Actually, no, you're wrong:

View attachment 389142

Unless you mean using your hobby expenses as the sole contributor to your miscellaneous deduction.

You are correct on this, and I was wrong, my bad. I thought you could still do it in some cases even afterward. However, if you're worried about this, quite honestly you should be doing it as a business. The same thing applies to the 1099-K thing, tbh. Except you'll get those businesses or not.
 

AladainAF

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FYI, the IRS delayed this until next year. This means your 2022 filing wont have to have it, but it will be on your 2023 filing (due Apr 15 2024)
 
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