Establishing Chainsaw Value

[cookies]

Document everything including labor, parts, paint, chemicals, dead parts sawand fuel/oil used to test run it, even ebays fees and the shipping if you offer it "free". You will find the profit margin shrinks to very little to tax but everything must be documented, write down every date/ time you work, save receipts including the values of parts you already own that you use to build the saw.
Ebay sellers listing 3/8lp chain as regular 3/8 chain to unload the sht are starting to really Pizz me off.

 

[Franny K]

I hope this is the right forum for this.
As some of you know, Ebay is now required to get your SS# and send a 1099 form if you sell more than $600 in the year and this must be reported as income. I want to establish a value of the materials and labor cost to get a saw in running or restored condition in order to deduct it. In some cases, it will have been several years since I worked on the saw. If I hadn't kept records at the time, any ideas on how to document this? For hourly labor charge, I was going to use the same rate as a local saw dealer and add cost of primer, paint, and any other materials used. For actual time, I was going to tear down a saw and estimate time to strip, bead blast, locate parts, re-paint and re-assemble. I'm guessing I would have around 20 - 30 hours in a saw, does this sound right?

"does this sound right?"

There is a business management section. Might try there and get a different bunch of commenters.

Does Ebay have help discussion groups kind of like a forum as in here to pursue this on?

First off There must be some schedule code to fill out. Like a work sheet. Schedule c is self-employment not sure if that would be it or another. Documentation is for an audit. Fill in the boxes or have your cpa do it is all needed to file. Perhaps there is a line to say the Ebay sales (or the stuff on those 1099 forms) were stuff you have more invested in than received.

You would have expenses and sales. Figure out how much you make an hour off of that. I suppose you could lease yourself space but charging off hourly labor? ok if it is someone else and you do payroll (if it is you then that counts as income right?). After 5 years of losses, it supposedly gets harder.

Do you need to be licensed with the consumer protection in your state to do this business?

What is your tax bracket, and will it end up better to take the standard deduction anyway? Maybe I am off here. Do you have a cpa do your taxes now?

Some of this tends to incentivize doing all your expenses via a card that can track them. Actually, what became law was pretty tame compared to some original text.


Are not you really going to do enough cash business so as to never show a profit even if one exists?

and you do payroll

 

[buzz sawyer]

"does this sound right?"

There is a business management section. Might try there and get a different bunch of commenters.

Does Ebay have help discussion groups kind of like a forum as in here to pursue this on?

First off There must be some schedule code to fill out. Like a work sheet. Schedule c is self-employment not sure if that would be it or another. Documentation is for an audit. Fill in the boxes or have your cpa do it is all needed to file. Perhaps there is a line to say the Ebay sales (or the stuff on those 1099 forms) were stuff you have more invested in than received.

You would have expenses and sales. Figure out how much you make an hour off of that. I suppose you could lease yourself space but charging off hourly labor? ok if it is someone else and you do payroll (if it is you then that counts as income right?). After 5 years of losses, it supposedly gets harder.

Do you need to be licensed with the consumer protection in your state to do this business?

What is your tax bracket, and will it end up better to take the standard deduction anyway? Maybe I am off here. Do you have a cpa do your taxes now?

Some of this tends to incentivize doing all your expenses via a card that can track them. Actually, what became law was pretty tame compared to some original text.


Are not you really going to do enough cash business so as to never show a profit even if one exists?

and you do payroll

You make good points. I may be opening a can of worms. As was said earlier, maybe best to avoid ebay, if possible, on high dollar items.

 

[Homer6679]

Well said Bill. Don’t use eBay and Craigslist I seem to get more scammers per listing. The easiest way to buy and sell I have found to avoid the government is hit the option of “I haven’t sold this item” or “I prefer not to answer” when you delete the listing on fb marketplace or OfferUp. The only way the government could prove you sold the chainsaws for the list price is to investigate each transaction after the fact with either a phone call or email. Don’t use any electronic payment types, the government can track that. Cash is king!

It is my uderstanding you won’t be able to deduct anything unless you get a 1099 or have a legit business such as an LLC. Which for the garage fix it guy probably isn’t practical.

 

[david newbie]

My son deals with FB marketplace all the time and gets some good deals. I have not and probably not in the future. It is not my way of doing business. I may have to sell a few saws soon though to generate income now I am off work for awhile barely walking and not being able to wear even socks let alone shoes.

Hope you’re not cutting wood barefoot ?

 

[Captain Bruce]

I quit selling on ebay quite a while before the government got involved. My dislike was the dishonest buyers. Not likely I'll ever sell there again..

The Gov't? Have you used eBay in the past year, as a seller? If not, you are living in the past.....................and aren't qualified to have an opinion about same. Take those grumpy old fart complaints up to the Cracker Barrel.....or Facepuke.

 

[Captain Bruce]

I do not think the thread is silly at all although I think your comment of ................taking up bench space at 65-80hour the deduction will be huge..............is quite silly.

The thread is not silly as the poster asked a legitimate question regarding tax filings. I understand he is asking about the income tax implications but there are also sales taxes charged to buyers now. I completely disagree with that. First off there should never be state sales taxes charged on interstate commerce, intrastate fine but but interstate. More importantly there should never be sales tax charged on a used item. The tax was paid long ago when it was sold new.

The poster was simply seeking advice on how to reduce a tax liability imposed by an overbearing government. His question is very valid.

His question is mis-directed, and causing all this banter. Dude, go ask a tax lawyer about your woes, and leave the chainsaw convo's here. These are some very smart members here, who devote hours helping others with mechanical issues, etc.
Nobody on arborsite can legally put you out of your monetary ignorance. Are you really thinking a forum comment will shore up a tax beef?

 

[BSG]

If Im not mistaking you can deduct /claim a loss on the item.
The only time you will have to substantiate it is during an audit.
The IRA looks at bang for the buck. I have a friend who is an IRA auditor.
They are not going to waste their time on a audit unless they can recover an amount in the thousands and some things are very hard to disprove like mileage.
So I say go for it!!

 

[a. palmer jr.]

I quit buying and selling on ebay in the early-mid 2000's when the fees went through the roof AND seller protections went out the window, all in favor of the buyers.

I was on my way out in the early 2000's also..

 

[a. palmer jr.]

No thank you on dealing with Marketplace. You have to deal with Facebook kids and they are the worst. Dealing with those idiots makes my brain hurt.

I'm speaking in general there are exceptions and there are some mature people to deal with.

I guess we can always keep a list of good and bad buyers/sellers..

 

[a. palmer jr.]

His question is mis-directed, and causing all this banter. Dude, go ask a tax lawyer about your woes, and leave the chainsaw convo's here. These are some very smart members here, who devote hours helping others with mechanical issues, etc.
Nobody on arborsite can legally put you out of your monetary ignorance. Are you really thinking a forum comment will shore up a tax beef?

You'd be surprised what some of these members have been through!

 

[sean donato]

I skipped after reading a few posts. I was pretty worried about the 1099 thing, ad I cleared out a lot of stuff this past year in ebay. Including roughly 20 saws in various states of repair. I asked my accountant about it, and was told it won't make a difference in my taxes as it's my hobby, not my business. It's a way to track your money by the government.

 

[a. palmer jr.]

I skipped after reading a few posts. I was pretty worried about the 1099 thing, ad I cleared out a lot of stuff this past year in ebay. Including roughly 20 saws in various states of repair. I asked my accountant about it, and was told it won't make a difference in my taxes as it's my hobby, not my business. It's a way to track your money by the government.

Maybe your accountant will help you pay your fines..

 

[sean donato]

Maybe your accountant will help you pay your fines..

Why would I have fines? This implies I'm doing something illegal, which I am not. I suggest you find a new accountant.

 

[dboyd351]

@sean donato I believe you are required by law to report all sources of income. Whether or not it is enough to make a profit or trigger an audit is another matter, but technically I am pretty sure you are required to report it- at least if it is over a certain amount (ebay says over $600).
Maybe you are the one that needs a new accountant if yours is advising not to report it.

 

[sean donato]

@sean donato I believe you are required by law to report all sources of income. Whether or not it is enough to make a profit or trigger an audit is another matter, but technically I am pretty sure you are required to report it- at least if it is over a certain amount (ebay says over $600).
Maybe you are the one that needs a new accountant if yours is advising not to report it.

Where did I say he said not to file it? Wait, I didn't. I said, my accountant told me it would affect my taxes, because it is a hobby.
https://www.irs.gov/newsroom/remind...rior to 2022, Form 1099,can trigger a 1099-K.

 

[sean donato]

More info.
https://www.irs.gov/payments/form-1099-k-frequently-asked-questions-individuals

 

[a. palmer jr.]

Where did I say he said not to file it? Wait, I didn't. I said, my accountant told me it would affect my taxes, because it is a hobby.
https://www.irs.gov/newsroom/remind...rior to 2022, Form 1099,can trigger a 1099-K.

You just stated in an above post that he said it wouldn't affect them. Which way is it?

 

[Bill G]

Hope you’re not cutting wood barefoot ?

I am not sure how to take that so I will just let it go with saying I am in a tough situation.

 

[Bill G]

The Gov't? Have you used eBay in the past year, as a seller? If not, you are living in the past.....................and aren't qualified to have an opinion about same. Take those grumpy old fart complaints up to the Cracker Barrel.....or Facepuke.

Well I have used in the past year a lot as both a seller and a buyer and I will assure you it has changed and not for the good.