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Do I have to file taxes selling online? - Ayami - 02-22-2014 01:24 PM
I sell clothing online through Ebay and Instagram and just barely made $700 so far. I'm unemployed right now and I plan on making this into a whole full-blown business, but it's not registered yet.
Will I have to pay taxes? What do I need to file? I live in Nevada.
Thank you for your replies.
Does SE tax cover selling used clothes? What about resale of clothes purchased new for the shop? Do I report those as profit in the 1040 form?
- Jim S - 02-22-2014 01:32 PM
Yep. File your Federal 1040 form with the deductible expenses for your business tallied up on Schedule C
- na - 02-22-2014 01:37 PM
You sold more than $400, so yes, you have to file because you will owe SE tax.
- Judy - 02-22-2014 01:49 PM
Yes. You need to file form 1040, and schedules C and SE. Yes it's required for used clothes and new.
Sales tax is something separate and additional.
- Bugsy - 02-22-2014 02:01 PM
ALL worldwide income, including the value of Barter, is reportable.
If you do not have gross revenue in excess of $400, and this is your only source of income, you would not have to file.
If you have other income and are required to file, you must report this income on Schedule C. If the Net Income (after expenses) is over $400, you also have to file a Schedule SE - Self Employed Tax. This is essentially the employee and employer portions of the Social Security and Medicare (aka FICA) contributions.
- Pascal the Gambler - 02-22-2014 02:14 PM
If you sold them for more than you paid, yes.
- tro - 02-22-2014 02:28 PM
you will file this income on Sch C and if the net amount is $400 or more you also will use Sch SE to calculate your self employment tax
and it doesn't matter if the clothes are new or used, you are selling them and you pay taxes on the profit
and you need to find out if you will need to register with your state sales tax agency to charge and collect sales tax in your state
- StephenWeinstein - 02-22-2014 02:40 PM
You have to file.
SE tax is for any money that you make by doing any type of work, except as an "employee".
If you buy clothes to resell them, then you report the sale.
If you sell clothes for more then they cost you, then you report that.
If you got clothes free and sold them, you report that.
The only time that you sell clothes and don't report it is if (1) you bought the clothes to wear, not to resell, and (2) you sell them for less than they cost you (or for exactly the same amount as they cost you).