(Topic ID: 301713)

Paying Cash with these Prices

By mrm_4

7 months ago


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  • 215 posts
  • 93 Pinsiders participating
  • Latest reply 7 months ago by sbmania
  • Topic is favorited by 7 Pinsiders

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    There are 215 posts in this topic. You are on page 5 of 5.
    #201 7 months ago
    Quoted from chuckwurt:

    For personal friends and family use, this rule doesn’t apply.

    Are you sure? It might be included, depending on the interpretation of the law. I bet PayPal ends the F&F option because of its misuse.

    The big issue is people selling $600 of pinball parts via paypal G&S will get a 1099-k. Get your parts sold before 2022!

    #202 7 months ago
    Quoted from KeeperUSA:

    Are you sure? It might be included, depending on the interpretation of the law. I bet PayPal ends the F&F option because of its misuse.

    Yes. If you give a friend money, that isn’t taxable for you or them. It would have to be millions.

    #203 7 months ago
    Quoted from chuckwurt:

    Yes. If you give a friend money, that isn’t taxable for you or them. It would have to be millions.

    I think you might be thinking about inheritance tax. As of 2020 (the most recent tax year), If you gift someone other than your spouse more than $15,000, you are required to file Form 709 and pay a gift tax. That's at the Federal level. I'm sure the various states will want their share, too.

    #204 7 months ago
    Quoted from zombywoof:

    I think you might be thinking about inheritance tax. As of 2020 (the most recent tax year), If you gift someone other than your spouse more than $15,000, you are required to file Form 709 and pay a gift tax. That's at the Federal level. I'm sure the various states will want their share, too.

    I’m thinking of gift tax.

    All a gift tax return is to track your tally of millions of dollars you’re allowed to give before it’s taxed. Stay under 15k in a year and the return isn’t needed.

    Turbo tax is your friend. Haha. But always get with a CPA to be safe.

    Btw, the lifetime exemption is like 11 million dollars last I checked. But this could all change with any presidential tax bill that is passed. All I’ve ever seen change in my career is the lifetime exemption.
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    #205 7 months ago
    Quoted from chuckwurt:

    Yes. If you give a friend money, that isn’t taxable for you or them. It would have to be millions.

    You are missing the point. If people misuse PP F&F to avoid receiving a 1099-K in 2022, it will quickly be included within the $600 reporting requirements for electronic payments. I don’t trust PayPal to provide a correct 1099-K that only includes G&S receipts. People on here and other sites are already asking for F&F payments on parts to evade tax.

    Are personal payments included in the criteria of IRC Section 6050W?

    Only commercial transactions will be reported to the IRS, not PayPal Friends and Family transactions. But PayPal monitors all the transactions on the platform in order to comply with government financial regulations. Thus, it can determine if commercial users are exploiting the PPFF option in order to evade the tax obligations.

    #206 7 months ago
    Quoted from Dayhuff:

    Couldn't have said it better myself. That $5K laying around the house is not going to earn enough "interest" any place you have it these days to make up for the piece of mind that knowing it's within reach should I need it at the spur of the moment. That would be the day I didn't make a deal on a game or anything else because I didn't have enough cash here at the house and had to wait for the bank to get it to me. Cash is King and always will be!
    John

    What he said.

    I'm not gonna bother calculating the paltry interest that the $5 grand I have in a drawer isn't earning because it's not in a bank. I can make all that in one flip - as long as the money is available in my drawer when I need it.

    #207 7 months ago

    I didn't read this entire thread, but it's incredibly dismaying to see how people have lost all sense of their rights....and how they seem perfectly willing to let the government and/or anyone else trample on them.

    Once the $600 limit hits the books...I assume everyone here realizes you'll be adding sales tax to every pinball machine purchase. You'll have to pay the price of the game, the transportation, and sales tax. That's because one of the additional IRS workers you hired at a fat salary will be able to audit your bank account and send you a nice, formal letter asking you to explain in clear terms why you took out $5000, what you did with it, and where is your proof that you paid sales tax on whatever you bought with it. If you sell a game...you'll similarly have to send some of that cash on the glass in to fund the Homeless Illegal Voters Program.

    I sure am sorry I voted for this! This is the last time I vote based on what Cardi B and Bruce Springsteen tell me is cool. I still recognize being cool (and laid back) is of utmost priority and I'm probably gonna apply for some federal aid in coping with that systemic disparity.

    Apple? Google? Same story.....people sign over their privacy 'en masse' these days. But that's a different story...

    As for the cash part....keep $10-20K on hand. Keep it in your gun safe along with your car title, house deed, passport, and shooting irons. If the house burns down while you are teaching your tantric yoga class or someone steals it, something very interesting will happen - life will go on.

    #208 7 months ago
    Quoted from KeeperUSA:

    You are missing the point. If people misuse PP F&F to avoid receiving a 1099-K in 2022, it will quickly be included within the $600 reporting requirements for electronic payments.

    You can’t make people pay tax on non business income. It’s either business or a gift.

    PayPal can change their rules all they want. But if the money is truly a gift, you don’t owe tax.

    This new rule is only going to increase F&F abuse. But my comments have nothing to do with that. My comments are meant to shed light on the misconception that F&F will get a 1099 for over $600 of transactions.

    #209 7 months ago
    Quoted from GregCon:

    I didn't read this entire thread, but it's incredibly dismaying to see how people have lost all sense of their rights....and how they seem perfectly willing to let the government and/or anyone else trample on them.
    Once the $600 limit hits the books...I assume everyone here realizes you'll be adding sales tax to every pinball machine purchase. You'll have to pay the price of the game, the transportation, and sales tax. That's because one of the additional IRS workers you hired at a fat salary will be able to audit your bank account and send you a nice, formal letter asking you to explain in clear terms why you took out $5000, what you did with it, and where is your proof that you paid sales tax on whatever you bought with it. If you sell a game...you'll similarly have to send some of that cash on the glass in to fund the Homeless Illegal Voters Program.
    I sure am sorry I voted for this! This is the last time I vote based on what Cardi B and Bruce Springsteen tell me is cool. I still recognize being cool (and laid back) is of utmost priority and I'm probably gonna apply for some federal aid in coping with that systemic disparity.
    Apple? Google? Same story.....people sign over their privacy 'en masse' these days. But that's a different story...
    As for the cash part....keep $10-20K on hand. Keep it in your gun safe along with your car title, house deed, passport, and shooting irons. If the house burns down while you are teaching your tantric yoga class or someone steals it, something very interesting will happen - life will go on.

    Get a grip.

    #210 7 months ago
    Quoted from Aurich:

    I'm sure plenty of people here sell enough mods to owe some decent taxes on them, but slide under the radar because it's less than $20k. And fair enough, not judging. But the world is catching up to these business practices, in the typical slow way these things take, and you're going to end up paying your share now.
    So it goes. As chuckwurt noted, you should have been already, so consider whatever you didn't a bonus.
    As for cash ... I haven't withdrawn a chunk in a bit, I don't know if anything has changed in Pandemic Times™ but last time I went to my BofA and said "gimme $7k in bills" there wasn't any noise about advance notice, or "sorry sir, you need to drive to multiple branches". They gave me an envelope of $100s, I bought my Metallica LE.
    Maybe that's my SoCal metropolis experience and more rural places can't hang with that, I dunno. It sounds frustrating though. It's your money, right? Too many rules about getting access to your own damn money sound wack to me. Sucks if you can't just take your business elsewhere.

    Last time I went to a bank for a large chunk of cash, they asked me to call a day of ahead (next time) to ensure they had it on hand. That’s a Capital One Bank in DC Meteo area… just as cosmopolitan as SoCal.

    I don’t think it’s uncommon.

    -3
    #211 7 months ago

    The one and only upside to this new $600 rule is it might start taking a chunk out of flippers and discourage a few from being leaches that provide nothing to anyone.

    #212 7 months ago
    Quoted from NPO:

    So would be running security clearance background checks on computers from the 1970s. Thank goodness that doesn't happen

    That computer from the 70s is probably more secure than crap from the 01s, assuming it's properly isolated and set up.

    #213 7 months ago
    Quoted from 27dnast:

    Last time I went to a bank for a large chunk of cash, they asked me to call a day of ahead (next time) to ensure they had it on hand. That’s a Capital One Bank in DC Meteo area… just as cosmopolitan as SoCal.
    I don’t think it’s uncommon.

    It is my understand that most banks keep less than around $25,000 cash on hand from day to day. It isn't like it was 20 years ago! So much money changes hands electronically these days banks really don't need a ton of cash on hand. So their attitude is "just keep what we need for a typical day plus a little more". I can't say that I blame them but it has changed things when you need a big chunk of cash all at once.

    Limit on how much you can withdraw on one day is just 1 of about 5 reasons I always keep cash on hand. Some things shouldn't be posted online but bottom line is when dealing in cash you don't have to worry about much of anything as far as limits, taxes, etc. My attitude is "hobby money" is "hobby money" and it isn't income, profit, etc. So making all transactions cash transactions just keeps it all simple. And avoiding putting that cash into the bank just to have to pull it out again in a week or two keeps things even more simple.

    1 week later
    #214 7 months ago

    Looks like the $600 limit for reporting is now $10K in latest revision:

    https://www.nytimes.com/live/2021/10/19/business/news-business-stock-market

    Key line: "banks would only be required to provide data on accounts with total annual deposits or withdrawals worth more than $10,000, rather than the $600 threshold that was initially proposed."

    The 10K limit doesn't include salary/payroll, just purchases. Looks like it'd be a good idea to keep a cash 'slush fund' around if you're going to be buying/selling more than 10K worth of games in a year.

    #215 7 months ago

    At today's prices, 10k may only be one or two machines! LOL! The thing is, banks can report the 10k transaction, but that doesn't necessarily mean that any of it is profit. It could be a break even sale or even a loss. You have to add in cost of parts you bought and any repairs you might have paid to have done. At the end of the day, there may be little or no profit at all on many sales. The pain in the butt is we will now need to keep more detailed records for any deposited monies over 10k so we can justify if there was or wasn't any profit. I don't think verbal explanations are going to carry much weight if you actually get audited, absent printed receipts.

    I usually try to buy games where I can get back most or all of my original investment when I sell. The proceeds then go into other game purchases. I could feasibly have thousands of dollars in sales in a year, with no or minimal profit. Seems like for those of us not millionaires or billionaires, there won't be much return for all of the work the govt puts in.

    There are 215 posts in this topic. You are on page 5 of 5.

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