getting an estimate of my taxable income (payments recieved from buyers) from PayPal

[azoroth]

Hi,

I have been receiving money through PayPal both from my frineds and family and from selling some old family stuffs. I understand the money I receive from family and friends are 'gifts' and hence not needed to be reported as 'taxable ' in tax return, is that correct?

However, I believe, the business payments are considered as 'taxable' income and needs to be reported. I honestly didn't keep a track of how much I made through selling goods (but that should be less than $20,000, so paypal will not send me an 1099). Is there any way I can retrieve from my account the payments I received as 'business' payment? How do I differentiate between 'personal' and 'business' payments?

I just need to see how much I should report in my tax file.

[Whac-A-Mole]

It is 200 transactions AND $20,000 under goods and services.

You should keep a sales ledger for you own good,go to Kroger or any store ,a spiral binder when on sale is only 19 cents.

how can you tell whether it is goods and services Or friend and family,I dont know if there is a way to distinguish?

[Whac-A-Mole]

you can go to report sections and ask to see monthly summary which will tell you in that month,how much you have collected,refunded,paypal fee ,chargeback fee,but there i sno breakdown of friend andfamily AND goods and services.

you can run detail activities and add up those transactions which have no paypal fee,that would be friend and family.

[azoroth]

Thanks! The payments without PayPal fee deductions as  'goods and service' payments make sense.

Along that line, I have two more questions:

(1) If I earn less than $20,000 and make less than 200 transaction through PayPal, I still have to report my income in my tax file, whether I received 1099 from PayPal or not, is that right?

(2) If I sort out 'business' payments from my PayPal account, Do I calculate 'net' or 'gross' amounts as 'taxable'?

[DPCreations]

All receipts for goods/services are considered gross receipts (not income).  As such it is reported on your 1040C business calculation for profit/loss. 

From the gross receipts, you then list your business expenses according to IRS categories.  Shopping costs are an expense.  You add all your businesses expenses and deduct from your revenue.  The result is either profit or loss which goes onto your 1040 form first page as taxable income.

[Whac-A-Mole]

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@azoroth wrote:

Thanks! The payments without PayPal fee deductions as  'goods and service' payments make sense.

Along that line, I have two more questions:

(1) If I earn less than $20,000 and make less than 200 transaction through PayPal, I still have to report my income in my tax file, whether I received 1099 from PayPal or not, is that right?

(2) If I sort out 'business' payments from my PayPal account, Do I calculate 'net' or 'gross' amounts as 'taxable'?

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You ,being an upright,patriotic ,honest citizen will report any taxable income.

What you recieve as goods and services would be gross ,you will arrve at net sales by subtracting any sales tax you collected and remittedto the state,any refund you made.

Then you figure your cost of goods sold,paypal fee,ebay fee,shipping,mileage driving to post office,insurance ,supplies,(paperclips,boxes,tapes,stamps),if you have more than one phone line,then one can be deducted,software,hardware used in business,incoming freight charge if you haev bought from vendors,bank fees etc etc.

If you want to file as a small business,there is a special form,which embraces all ofthe above plus more ,like prorating part of your home as office ,maintenace,property tax,insurance.

you would be surprised after all these expenses,you have a LOSS !!!!!!!!!!!!!!!!!!!