The IRS announced new regulations! A huge blow to online sellers such as eBay and Etsy!

According to foreign media reports, the IRS recently announced a new regulation that starting in January 2022, any seller who sells goods worth more than $600 through shopping websites such as eBay, Etsy or Facebook Marketplace will need to report the transaction in detail to the IRS. The seller will receive a 1099-K form and fill in the specific information. The regulation applies to anyone who processes payment for goods through a third-party payment network (such as PayPal or Venmo).

It is learned that in the United States, nearly one in five people sell items online. The new regulations have also caused concerns and confusion among many sellers, and many sellers even said they would give up sales.

Barbara Weltman, an attorney at the IRS, said that sellers do not need to worry or be anxious, because there is no change in the seller's sales activities. On the contrary, the workload of payment processors will be greatly increased because they need to issue 1099-K forms to many sellers. In addition, in fact, even if there is no form, sellers still need to pay certain taxes to the IRS.

Industry insider Lisa Greene-Lewis said that for sellers of new (and used) items on sites such as eBay, many sellers were unable to sell enough goods and never received a 1099-K form. But the new regulations will allow these sellers to track their online business in a timely manner and know their sales. In addition, only the total transaction amount needs to be submitted on the form, and no other credit, collection fee and other information.

Lisa Greene-Lewis further stated that it is certain that online sales will become more difficult in the future, whether it is selling goods on new e-commerce platforms, or the competition between platforms and the charges on merchants will intensify. Sellers should maintain good bookkeeping and record keeping habits to prevent some policy changes.

It is understood that currently, only sellers who sell goods worth $20,000 and complete at least 200 transactions will report transactions to the IRS. Many sellers will not actively report their sales.

Editor ✎ Nicole/

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