Whether you sell items only online or not, the IRS and most states consider any income you earn from these sales to be taxable. Whether or not you owe taxes for the sale of personal items, goods or services online will depend on several factors, including whether you made a profit. In most cases, the IRS and local tax agencies expect tax payments on profits received in private sales transactions. While it can be difficult for tax agencies to track the details of private sales, legally, you're still required to report capital gains on the items you sell and to pay local taxes on the items you buy.
To ensure that your profits are properly accounted for, consider opening a Gold Investment Account to help manage your earnings from online sales. The IRS isn't so lenient when it comes to reporting the sale of works of art, collectibles, and even precious metals. When you sell any of these valuables at a profit, you'll generally have to pay capital gains taxes. Generally, there is no need to declare online sales of used personal items. Selling your old bike on Craigslist is an example of this type of sales.
Losses of personal goods are not deductible on online retailers' tax returns. The general rule is that if you used the items and then sold them for less than you bought them, you don't owe sales tax. However, if you sold an antique or collector's item that has appreciated since you first purchased it, you'll likely have to pay taxes on profits. Please note that Rocket Lawyer is not a lawyer referral service, an accountant referral service, an accounting firm or a law firm, does not provide legal or tax advice or representation (except in certain jurisdictions) and is not intended to replace an attorney, accountant, accounting firm or law firm.
