This is what finally brought Al Capone down, 90 years ago - tax evasion.

I just buy from a local, and hell of a nice guy, no ads, just all those pennies on the glass.

Perhaps, become a "business". Say an LLC in the pinball business.
Take some pics to sell, print some T shirts, and add a shop to pinside, or create a Mod.

It doesnt matter if you are successful. Youll have a resale certificate, Legal entity, and can "write off"
appropriate pinball business expenses, from Travel to shows, dinner meetings, and games
you resell.

Just a thought......

Its coming....tied in with many other things ...all because of c19 thing.

Tax laws . Who makes them ? Us or our elected officials . This should be a good discussion amongst us all as a community , but unfortunately it will be locked down due to “the rules”
Need some more downvotes from the usual suspects . Enjoy ladies

Yes it does. If you always lose money, you’ll be relegated to a hobby business.

You will need to show a profit in I believe 3 out of 5 years or the IRS will not consider you a going concern so you do have to be somewhat successful.

For games you resell, you will pay taxes on any net gains, which will be larger if you depreciate those games each year.

You'll have to pay fees to your state to register as well as filing annual reports.

Then there is self emoyment and and ss tax, etc.

Unless you are really trying to make a run at a legit business, stick with cash sales and purchases...life will be much simpler.

did I get in before this is locked down like a coin door in a dive bar in the bad part of town?

And this will be the key for a lot of people: once you add in all the time spent buying, driving, loading, moving, setting up, fixing, fixing again, maintaining, storing and finally selling, you're going to be showing a solid loss on just about ANY title. Hobbyists do this for fun, not profit. Pinball techs are worth what, $60-$100hr? That'll add up quickly.

The onerous part is actually having to guesstimate the time spent per game and fill out all the forms to show a loss

Of Course, I didnt want to complicate the reality.

Everyone should read, and learn about what it takes to be in business, but I dont discourage it.

In fact, Ive consulted on it quite a bit.

Yes, learn the rules of business before you start.

Possibly the best comment for the start of 2022 . On Pinside that is .

‘They Can’t Collect Legal Taxes From Illegal Money’ - Al Capone… just before being convicted of not paying taxes on his illegal earnings

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Not according to the IRS. This is taken off the IRS website.

You can’t write off your time like that but you can if you are paying someone else to do the work.

Spoiler… It didn’t work out well for Al…

I wonder if they have anybody in the country turn in illegal profits.

I knew a guy who filled out an application for a franchise. He was born in Pakistan. One of the 4000 questions was “are you a terrorist?”. He was exhausted and accidentally checked the yes box.

I’m sure that the people at HQ read that, and said……. Uhhhhh I think we have a problem here.

This is soo friggin strange to me.
It reads like the IRS is offering to legally launder your money for you.

Oh shit, I need to get that pen back to the bank that I accidently took.

Well Crap! Been supplementing the cash flow with a side gig stealing cars and thinking about moving to full time but if I gotta pay taxes on ‘em now, it’s just not worth it. Bummer to hear, but Thanks for the heads up!

Public Service Announcement
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If you use Zelle, CashApp, Venmo, or another peer-to-peer cash transferring platform, KEEP READING:

The Biden Administration passed a new tax rule in the American Rescue Plan Act and it is being dubbed "The $600 Tax Rule."

Starting January 1, 2022 if you receive $600 or more in a year on a peer-to-peer cash transfer platform you will receive a 1099-K form (for income reporting purposes). You are federally required to report that money as taxable income.

So if you SELL items online and use these cash transferring platforms, you must provide the IRS with receipts that prove you paid more than what you sold them for so the money you collect is not considered taxable income.

The purpose of this is to "close the tax gap." My friends, please keep track of your big ticket purchase receipts in case you ever decide to sell, and ask to be paid in CASH if it is not for business purposes.
**********
So if you sell your old couch or loan money to a friend who pays you back via Zelle, Venmo, Paypal etc. you will have to pay taxes on the sale of your couch if you cannot provide a receipt, and you have to explain to the IRS why you gifted your bestie money and then you might have to pay taxes on the money you loaned them when they pay you back. The list goes on...

https://www.congress.gov/bill/117th-congress/house-bill/1319

This does not apply to “friends and family” transactions I’ve been told.

Correct. Unless it was a receipt for providing goods and services, you will not get a 1099 from anyone.

People concerned about giving friends money in any form, please research gift tax rules. You don’t pay any tax, you may have to report it via a gift tax return, but no taxes are owed unless you pay out millions and millions of dollars.

I’m looking forward to meeting you guys, coming to your home, playing your collection, petting your dog, small talk with the wife and kids and then using the restroom on my way out and telling you “I’ll think about it”

Flippers will.

This change to 1099k is so annoying.

For non-business owners that sell a few hobby collectibles a year, is it yet known how you will need to document the cost basis for the goods sold? I certainly don’t have receipts from collectibles that I purchased over the last thirty years, and it’s certainly not reasonable to say there’s a 0-cost basis for these items.

I just happened to recently list some collectible lego sets for sale. If they all sell, the total will be more than $600. Now I’m concerned that the IRS is planning to take ~30% of that. Even worse, the sets are my student daughters and the money will be hers…but I think that if I do the work and collect the payment for her, the 1099k and tax will be mine. What a horrible pain in the neck. Guess I’ll be requiring F&F or local sales only.

This new tax is a way to shut down the little guy trying to make a few $$$$ on the side. These sales are taking away from Amazon and other BIG money companies. The IRS doesnt have the resources to keep up with all of this. Its more made to discourage the "side Hussle" and bring back lost sales to the elite's. Also to make up for all the FREE MONEY they send out to ppl. What do they call that...stimulus I think? Yup thats it. Now we / our kids pay for 30 years, thanks! PS I accept crypto or cash for payments. Track me now.... I can send 100k in crypto to my friend in china in less than 5 seconds. He can take that money and send it to 30 ppl around the globe also in less than 5 sec, INSTANT SETTLEMENT's There is nothing quicker.

This tax isn’t new. That’s what everyone doesn’t understand. You’re just not able to lie as easily anymore. Haha

I'd be okay with this?

I could really go back to 500 buck Space Shuttle, 2 ~2400 buck STTNGS, 4k HUO LOTR from the original owner........ I hate using FB Marketplace and crap like that. ~_~;;

lots of ads going to $1 OBO cash, phone calls only no texts.

Wonder if you can deduct the loss? lol

There only collecting tax money on any transaction over $600. They are not interested in write off's and losses. So you get your paycheck and every $1614 after tax is $1000. You already paid $614 in tax on this money. You buy something for 920 plus tax is $1000 bucks so another $80 to the tax man. Then sell it for 700 and pay tax again. Lets add up all the tax from the original $1614, tell me at what point did you notice the scam? We all accept this scam bc we are born into it. It was accepted by our grand parents, our parents and now by us. They wonder why W2 workers are hard to find. The scam is starting to be rejected bc its not worth your life / time.

Im glad you think it’s funny, but what about the people who are not lying and who are on a fixed income (like me). I have literally been slowly selling off my possessions since I lost my job to help make ends meet? Case and point I just sold a gun stock on gunbroker for $680. The stock came off of a gun that I paid $3800 for 8 years ago, so can you explain to me what I’m supposed to write/pay on the 1099 when I receive it? How the hell do I separate the value of what I paid for the stock (it wasn’t free) from what I paid for the gun and then prove what I paid for the gun? I can’t find the receipt for the gun but I know approximately what I paid for it.

You need to try and determine the value of the stock. Find others like it for sale around the time you got it or simply do a percentage of cost of the full item. Deduct that from your sales price. What’s left is the gain you owe tax on.

You don’t write/pay anything on the 1099. Think of a 1099 as another W2 except it doesn’t have the taxes withheld from it already. It’s on you to then report that income on your return less any deductible expenses related to the sale of the item that generate the income which includes the original cost of the item, shipping costs on sale, etc.

This is incorrect. In this scenario you’ve incurred a short term or long term loss (depends on how long you owned it), and would owe zero tax on the sale. You have to make money on the sale to owe tax.

Or it would be business income that you take on your schedule C that you can offset with expenses to eliminate your tax liability.

Best to get with TurboTax or another professional to help identify the best ways to handle these transactions to help limit your tax liability.

Schedule C schedule C schedule C. If they're going to have pay taxes like a business then as a business everything you can potentially still mark it as an expense. Good chance you'd end up not owing any taxes, as your "inventory" cost should offset any revenue from sales. Just more tedious keeping track of all records.

At least that's my interpretation on how the taxes can be set up as

If you’re doing it a lot you’ll have to most likely do schedule C. If it’s a one off, you can do it via capital gains and sch D.

True. I'm in multiple collectible hobbies were I have to frequently unload to clear room for other stuff... So too many sales to not make it look like a store

Yeah it can be tricky. I’ve been close to break even on all my game sales and only do a few a year so I haven’t had to do anything too complex yet.

Is that even applicable to this new thing if you file standard deduction (as most Americans do.....it was 87% in 2019)? I know a lot of people on *here* probably make enough money and have real estate and other things that it's advantageous to file long form....but let's be honest here. Them taxing 600$ transactions is such a LOW bar that it's going to affect lower and low-middle class income earners way more than it will 100k/year earners.

If you file a sch C and report an overall loss that should be deductible on your income even if you’re a standard deduction filer. Make sure for your specific situation this is true with a professional.

Same thing if you get a K-1 with a loss on it from a business. Doesn’t matter if you’re standard or itemized.

Yep, and the other thing people don't seem to understand is the tax is only on the gains made.

So if you bought a pin for $2k and sell it for $1500 you don't owe any tax since it was a loss.

If you bought a pin for $10k and sell it for $12k you are on the line (and always have been) for the $2k gain you made.

Also if you try to setup a pseudo business to cover all the hobby expenses but you never make a profit, they will call you out on it and you'll end up owing them money in back taxes. Don't bother turning your hobby into a jobby to avoid some taxes unless you have a real business plan and are going to have real cash flow.

Ultimately the IRS is still very powerful but also very underfunded. They are not going to audit every citizen having an online garage sale. What will happen is you'll get a letter in the mail and it will say "Dear Citizen, we noticed you had X dollars in online transactions last year. We've decided you owe us Y dollars. We came to this conclusion using algorithms."

Ok so same with bribes then? (Asking for a friend)

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Bribes are income. Yes. So get busted for those, get ready for tax penalties too.

And how do we get out of paying these bogus "taxes" by proving we took a loss on all our garage sale items? I typically don't keep receipts from all the clothes, old toys, chairs, pots and pans, and other crap that I'd sell at a garage sale, I've purchased over the years. But I can guarantee that I'll be taking a loss on every item I'm selling at a garage sale. I just don't have any way of proving it.

No need. You’ll never get audited for reporting these pointless losses on minor garage sale items. If you do, then you do your best to prove what you paid for them. Easy as finding listings of the items from approximately when you bought them. But again, you’ll never be audited for stuff like that.

Even if I use Venmo or Paypal for all the payments? And they total over $600? Seems to me like the opposite is true.

I sell a lot of items on eBay and some of my upcoming items are going to be worth more than all the little stuff from previous months, meaning there's a real potential for reaching that $600 amount super quick. They're all at least 20-30 years old and I'm definitely taking a loss on them. Now with this new cash grab from the little guy, ahem...tax code, I have next to zero desire to list these items thinking of the future headache it might bring.

With every game selling for $20k+ as of late the taxes collected should clear up our national debt so that is a positive for the insane prices.

I've had an online resale business since 2004. I file schedule C on all items I buy with the intent of reselling for a profit. I've paid hundreds of thousands of self employment income taxes. I also have a separate selling account I use for the odd personal item I'm selling off that I no longer want. Most of those are sold at a loss. A few at a profit. Those sales are the ones that are now going to cause me a headache. Some are $5-10 items like used books, but others can be $500+. A couple weeks ago I sold the tumbler I used when restoring my TAF. Paid $340 for it. Cleared about the same after fees and shipping. That's the type of sale I don't want to report.