John, This is not the same ruling.
Here's the one I am talking about: http://taxes.about.com/od/businesstaxes/qt/cardreporting.htm And it starts in 2011, not in 2010 or 2009. The triggers are gross receipts over 20K or 200 transactions / year. It's easy to cross 200 transactions / year without getting close to 20K with low dollar eBay sales. The impact on small eBay sellers is that most are running a margin of 20% or less after covering their material cost, eBay fees and PayPal fees. And most don't have a FEIN. Without a FEIN, their gross receipts (and not just their margin) will be subject to 28% withholding. Also, I suspect that most don't pay income tax and with low margins, selling on eBay will not be worth the effort. I suspect that a lot of them will just drop out of the eBay game. This is why I stated that the ruling would hurt eBay. Thanks, Tom Hargrave www.kegkits.com 256-656-1924 -----Original Message----- From: [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED] On Behalf Of John Freer Sent: Thursday, August 28, 2008 12:17 AM To: Mercedes Discussion List Subject: Re: [MBZ] Recent IRS Ruling (no joke) According to http://www.snopes.com/politics/taxes/paypal.asp, this is true but the intent is to review only offshore transactions. Also applies to more than just credit cards though. On 8/27/08, Tom Hargrave <[EMAIL PROTECTED]> wore rote: > A recent IRS ruling will require all CC processors (merchant accounts) to > report revenue to the IRS. And if your CC merchant account is setup with a > SS# instead of a FEIN#, your processor will be required to withhold income > tax against the revenue. > > > > The ruling will affect all PayPal accounts that are setup to accept credit > cards since the front end (the CC processing part of PayPal) is classified > as a merchant account. I don't know how PayPal will handle accounts that do > not process credit cards. > > > > I was wondering how the IRS was going to get their arms around the cash > flowing through eBay and now I know. I'm sure that this ruling will put a > few nails in eBay's coffin or at least it will slow them down a little. > > > > I gave up on eBay earlier this year because I could not compete with other, > smaller beer equipment resellers who I'm convinced are not paying any income > tax on their sales. From my point of view, the ruling will help to level the > playing field. > > > > The ruling goes into affect in 2009 or 2010 (don't remember which). > > > > Cynthia, > > > > Thanks for the info. > > > > Thanks, > > Tom Hargrave > > HYPERLINK "http://www.kegkits.com"www.kegkits.com > > 256-656-1924 > > > > > > > No virus found in this outgoing message. > Checked by AVG. > Version: 7.5.526 / Virus Database: 270.6.9/1636 - Release Date: 8/26/2008 > 7:09 PM > > _______________________________________ > http://www.okiebenz.com > For new parts see official list sponsor: http://www.buymbparts.com/ > For used parts email [EMAIL PROTECTED] > > To Unsubscribe or change delivery options go to: > http://okiebenz.com/mailman/listinfo/mercedes_okiebenz.com > _______________________________________ http://www.okiebenz.com For new parts see official list sponsor: http://www.buymbparts.com/ For used parts email [EMAIL PROTECTED] To Unsubscribe or change delivery options go to: http://okiebenz.com/mailman/listinfo/mercedes_okiebenz.com No virus found in this incoming message. Checked by AVG. Version: 7.5.526 / Virus Database: 270.6.9/1636 - Release Date: 8/26/2008 7:09 PM No virus found in this outgoing message. Checked by AVG. Version: 7.5.526 / Virus Database: 270.6.9/1636 - Release Date: 8/26/2008 7:09 PM _______________________________________ http://www.okiebenz.com For new parts see official list sponsor: http://www.buymbparts.com/ For used parts email [EMAIL PROTECTED] To Unsubscribe or change delivery options go to: http://okiebenz.com/mailman/listinfo/mercedes_okiebenz.com
