Be very careful.. Especially, if you have a linked bank account to paypal. In my situation, seller did not pay as friends and family. I immediately refunded payment as I
did not want to experience any possible paypal issues. Next, paypal took out the full amount of the sale from my bank account, took $98.90 for their fees and put
the remaining amount of the returned sale amount into available paypal funds. This is a very deceptive practice which is not acceptable. I issued the buyer a refund immediately. There was no exchange of money so Paypal should not be allowed to take from anyone's account.
Your best bet is to either not use paypal or do not link any bank accounts at all. You can dispute the charge with your credit card company. This is highway robbery.