Claiming Paypal Funds for Taxes ?

[clown]

Hello, just wondering how many of you claim paypal funds for domain, ebay, ect... for tax purposes.
I claim the funds but I do not know the exact rules for this type of issue.

thanks,
jay

 

[DNGeeks]

The correct answer is that everyone claims 100% of the income they generate. The truth is different, but I doubt you'll get people to admit it. I suppose it's a good thing that I dont' have an account with paypal so I'm totally clear

 

[clown]

yes , you are correct, but I have never heard of anyone other than me claiming paypal income.

 

[dsturbed]

Seems like something that you should discuss with your accountant, I would imagine that Paypal income would fall under *misc* income... there's so many loop holes in taxes year by year it'll make your head spin

 

[Biggie]

Hello, just wondering how many of you claim paypal funds for domain, ebay, ect... for tax purposes.
I claim the funds but I do not know the exact rules for this type of issue.

thanks,
jay

Hi

you should consult a tax accountant.

the funds you receive, do not account for the "cost of acquisition"

which is the net profit

if you're claiming income, without deducting expenses, then you may be paying too much in taxes.

 

[clown]

I claim paypal income but I do deduct expenses.
As I was saying, everyone I spoke to so far has told me they do not claim paypal funds, I would think it would be easy enough for the IRS to get paypal info yet they dont.

Paypal also does not send me any documention for taxes.

 

[ParkQuick.com]

Maybe you are referring to PayPal FEES rather than PayPal FUNDS? PayPal fees would be in the same category as bank service charges.

 

[clown]

no, I mean paypal funds, I claim everything i make through paypal. just wanted to know if everyone does also, selling domains is a sketchy area when it comes to taxes, ect... but $ received should be claimed, no?

 

[ParkQuick.com]

Yes - of course PayPal funds should be claimed. It's money and there is a very good "paper trail" if you are ever audited. Most transactions even include the name of the domain name. I was just surprised that someone would ask. Maybe that's why many people don't use real names in here (?) (No offense intended toward anyone.)

 

[clown]

Well, i figured I would ask just to see if I was crazy for claiming it. sorry , didnt mean to stir anything up.

 

[Prosperous]

No you're not a crazy clown :-D , I claim PP for taxes, too. Many do.


Rob

 

[spiderden]

It is as with any other business, you report the profit, if you don't and they audit you, they may find your paypal account and any other bank account and fine you for not reporting the income. When you sign your taxes you state you have reported all of your income. If you are under age and your parents are claiming you, then they should report your profit on their taxes.

However past dealings with IRS, they mostly work off 1099's etc. It is not up to paypal to report it and the IRS does not get general access to any companies client base.

my 2 cents

 

[denny007]

Now this is advantage of NOT beeing US citizen. Paypal will not share info with my countrys tax office

 

[DNQuest.com]

To clear this up, it is not Paypal funds that you claim, it is the revenue you need (or should) to claim regardless of the form of payment. I know when I pay for something via paypal, my records will show this. So the IRS knows if I send payment via Paypal, they know someone is receiving funds via Payal.

So, if you are running a business or making over $600 in revenue (not profit), you should be claiming the money on your taxes. You also should be claiming the Paypal fees, registrations (purschases) as an expense.

 

[spiderden]

I know this... it sure sucks... between the wife and them, I feel like I get screwed a lot

 

[Focus]

Glad I spent money of some domains before the end of the year! Every single domain purchase you make, every hosting fee, renewal fee, etc etc, even DSL service is part of your business expense...these costs deducted from any income = net profit

 

[clown]

yep, its pretty amazing , we just did my taxes a bunch of different ways, by removing 10k off the top literally saves me 3,100$, its ridiculous but it has to be done. what stinks is when you own your own business you have to pay about 15% social security tax instead of 7.5 when you work for employer, I work, own my own business, and do domains so I pay alot of tax.

 

[scorpio]

Now this is advantage of NOT beeing US citizen. Paypal will not share info with my countrys tax office

My country tax officers also know what a paypal is . Even Bank managers of big banks dont know what paypal is.

 

[Domagon]

Even bartered transactions are taxable ... just because it's PayPal and not actual dollars is irrelevant for tax purposes.

It may even be advantageous to report such income if you've then used it to acquire other domains, etc ... you may actually be able to reduce your tax liability.

Ron

 

[TheLegendaryJP]

I would think it isnt the paypal account but where you access the funds there after. I personally transfer them into my bank account. If i get audited do they do so because of my bank account? Doubtful, if anything in my country exceeds $10K they usually ask for a declaration statement. Does that get seen by the tax dep. Doubtful again UNLESS I am audited.