Making an ebay business full time.

Quote from eddiehaskell : even if ebay was great about returns for sellers, it is hard to make much money after ebay dips in twice and the government takes their share.

Gov only takes their share if you hit 20k correct?

Quote from Mr.Ritz : Gov only takes their share if you hit 20k correct?

Uhh. No.

Quote from vaultaddict : Uhh. No.

Explain. From understanding ebay/paypal only sends you an IRS form if you hit 20k or so many items sold.

Quote from Mr.Ritz : Explain. From understanding ebay/paypal only sends you an IRS form if you hit 20k or so many items sold.

And you've somehow conflated that with whether it's necessary to pay tax on that income?

Why?

Quote from vaultaddict : And you've somehow conflated that with whether it's necessary to pay tax on that income? Why?

Because everyone reports ALL income

Quote from Mr.Ritz : Because everyone reports ALL income

Oh, tax fraud.

Ok then.

GL

Quote from Mr.Ritz : Gov only takes their share if you hit 20k correct?

Quote from vaultaddict : Uhh. No.

Most people don't hit the $20k per year annual income on PayPal. That part is obvious.

However, there are people who make money on eBay but dont break the lowest income tax bracket. No 'fraud' going on there.

I was reported when I had only made $11k (profit), IRS sent me a letter for it. I didn't even realize that was enough money to get taxed on at the time.

Quote from Mr.Ritz : Gov only takes their share if you hit 20k correct?

Nope.

1) Find a popular item on ebay.
2) Look at the "Completed Listings" to determine the average selling price. Subtract ebay and paypal fees. Determine what price you need to buy the item to make the amount of profit you want.
3) Get a business license.
4) Get a resaler certificate so that you do not need to pay sales tax on the items you are purchasing for resale. If you do not have this, manufacturers/distributors will not deal with you.
5) Contact the manufacturer. If the manufacturer will not supply you with the product because the quanitity you are purchasing to too small, then ask the manufacturer for the contact information of one of their distributors.
6) Ask the manufacturer/distributor what quantity you will need to buy to get the price per unit that you want. The more you buy, the lower the price per unit. $20 per unit for an order of 100 units. $13 per unit for an order of 1,000 units. Use your profits to buy more items/larger quantities so that you can make more money. The larger quantity you buy, the greater profit you can make, but you are taking on more risk. If customer demand drops or a competitor sells below your cost, you will start losing money.
7) Get a sales tax permit if you sell your items to people located in the state you live in.
8) Setup an ecommerce website and list your products. On your ebay product listing put a link to your website and include a coupon for a discount. The coupon will lure buyers away from ebay to your ecommerce website since they can buy the item cheaper. No ebay fee and paypal fee = more profit.
9) Estimate your state/federal taxes and make state/federal estimated tax payments if you are making a profit.
10) You might need to pay property tax on inventory if you hold the inventory for a certain period of time.

Random Question.

I buy item for $10 but it only sells for $7.

I buy for $7 and sell for $10

I do this 1000 times for each and make nothing, Do i still get hit by paypal for said "profit" because they don't see expense.

Quote from Scubastevie : Random Question. I buy item for $10 but it only sells for $7. I buy for $7 and sell for $10 I do this 1000 times for each and make nothing, Do i still get hit by paypal for said "profit" because they don't see expense.

Yes, you get charged a fees because of the marketplace they offer. You are being "hit by paypal" not for any "profit", but for the convenience of making a sale by using the marketplace that they created. It is a commission, that is just a cost of doing business for you.

You will need to account for this fees, and you can obviously deduct it for taxes (i.e. you will report a net loss in your example after fees).

import from china,but not knock offs

Quote from SlickDaddy : 1) Find a popular item on ebay. 2) Look at the "Completed Listings" to determine the average selling price. Subtract ebay and paypal fees. Determine what price you need to buy the item to make the amount of profit you want. 3) Get a business license. 4) Get a resaler certificate so that you do not need to pay sales tax on the items you are purchasing for resale. If you do not have this, manufacturers/disbtributors will not deal with you. 5) Contact the manufacturer. If the manufacturer will not supply you with the product because the quanitity you are purchasing to too small, then ask the manufacturer for the contact information of one of their distributors. 6) Ask the manufacturer/distributor what quanity you will need to buy to get the price per unit that you want. The more you buy, the lower the price per unit. $20 per unit for an order of 100 units. $13 per unit for an order of 1,000 units. Use your profits to buy more items/larger quanities so that you can make more money. 7) Get a sales tax permit if you sell your items to people located in the state you live in. 8) Setup an ecommerce website and list your products. On your ebay product listing put a link to your website and include a coupon for a discount. The coupon will lure buyers away from ebay to your ecommerce website since they can buy the item cheaper. No ebay fee and paypal fee = more profit. 9) Estimate your taxes and make payments to the US treasury if you making a profit. 10) You might need to pay property tax on inventory if you hold the inventory for a certain period of time.

This is really solid info. Thanks for taking the time to share.

Quote from turningpoint84 : How are you going to eat? I think you need more then $300 a month profit...... Anyways look for local auctions, i buy stuff all the time through local online auctions and resell them on ebay for 4x the price. It's fun making extra money on the side, i make $70K a year at my salary job, and own a rental property that makes about $1000 a month. Honestly this is a little off-topic, but you should keep your job, and try to get approved for a cheap rental property(2-4 family). Have a renter in the otherunits pay all your bills. Then you have no rent. Assuming you only pay $300 a month, there HAS to be cheap property near you. FHA loans only require 3.5% down, so save up $2000-5000 and boom you're set for life.

What kind of rental property do you have?