| |
| |
|
Auction Information |
|
|
|
Taxing Your eBay Profits
As a small business person-slash-advice columnist I dread the first quarter of the new year. Not because in my mind my own business fortunes start at zero again every January or because I have already dismissed every New Year's resolution I made when the clock rang out the New Year. No, the reason I dread the first quarter of the new year is that my email box floods with questions about business taxes and the IRS, my two least favorite subjects on earth. It's not that I am opposed to paying my fair share of business taxes. It's that I consider the IRS to be a little like Beetlejuice, the movie demon who appeared only after his name was called three times in a row. My fear is if I write too many IRS columns their dark agents may appear on my doorstep, ready to drag me away to an uncertain fate. Oh well, one must do his duty no matter the consequences, so here we go?. Q: I am starting a small retail business. While talking to a potential supplier last week he asked for my EIN number. I had no idea what he was talking about, so I told him I would have to get back with him because I didn't have the number handy. What is an EIN number and why do I need one? -- Robert P. A: Robert, do you remember the old Johnny Rivers song "Secret Agent Man?" There was a line that said, "They're giving you a number and taking away your name."An EIN isn't as cool as a secret agent number, but it works much the same way when it comes to your business' relationship with the IRS. Instead of identifying your business by name, the IRS identifies your business by EIN. EIN stands for Employer Identification Number and is also known as a federal tax ID number. The EIN is a nine-digit number that the IRS assigns to businesses and is used to identify taxpayers that are required to file various business tax returns. Does your business need an EIN?According to the IRS the answer is yes if: · Your business has employees · Your business is a corporation or partnership · You file returns for Employment, Excise, or Alcohol, Tobacco and Firearms tax · You withhold taxes on income (other than wages) paid to a non-resident alien. · Your business has a Keogh plan · Your business involves trust, estate, real estate mortgage investment conduits, non-profit, farmers' cooperatives, or plan administrators. Applying for an EIN is a relatively painless task. You can apply online at the IRS website (irs.gov), apply by mail or telephone, or if you do business in a state that participates in the Federal Employer Identification Number project you can apply through you local IRS office (sorry, Alabama is not one of them). You will need an EIN number prior to filing business returns with the IRS, so make sure you give yourself plenty of time to obtain one. For more information on EINs and your business, consult your accountant. And while we're on the subject ? Q: I made extra money selling things on eBay last year. These were items I picked up at yardsales mostly. My husband says I am responsible for paying income tax on the money I made, but I disagree. This is just my hobby, not a business. What do you think?-- Gladys A. A: With so many people selling on eBay these days this is a question I get quite a bit. In fact, I have plans for a future "eBay and taxes" column, but I believe your question is more, "is it a hobby or is it a business?" Again, I went to the horse's mouth (at least I think it was the mouth) for the answer. According to the IRS there are a number of factors that help determine if your hobby can be considered a business and thereby make you susceptible to the IRS tax rules governing business. Do you carry on the activity in a business-like manner? If you conduct your eBay activities like a business, i.e. you keep business records, track your profit and loss, keep a separate checking account, etc. then whether you think so or not, your hobby is considered a business. If you put considerable time and effort into your venture, the IRS may contend that you do so for profit and not fun. It seems the folks at the IRS don't believe in doing things strictly for pleasure. My guess is, neither do you. If you weren't making money selling on eBay I doubt you'd be bothering getting up at 4am to hit all those yardsales. Then again, maybe you would? If you depend on income from your eBay activities for your livelihood, it's a business, not a hobby. There are a number of other factors the IRS considers to determine if a hobby is really a business, but in your case I think that covers the basics. For detailed answers to any tax question you should consult a qualified accountant or tax attorney.God forbid you rely on a guy who is afraid to mumble the letters "IRS" three times in a row. Small Business Q&A is written by veteran entrepreneur and syndicated columnist, Tim Knox. Tim's latest books include "Small Business Success Secrets" and "The 30 Day Blueprint For Success!" Related Links: http://www.smallbusinessqa.com http://www.dropshipwholesale.net
MORE RESOURCES:
auctions - Google News |
|
|
|
RELATED ARTICLES
12 Tips To Make Your eBay Business More Profitable Sometimes it's the simple things that can make your eBay business more profitable and run smoother. Here are twelve things you can do that will lead to more sales and increased profits on eBay. Why Ebay Is The Best Place To Make Your First $1000 Online I'd like to begin with a question - and I'll bet the answer is going to surprise you (it sure did surprise me!).Q. Ebay And Dropshipping, A Marriage Made In Heaven? eBay is the 'BEST' opportunity you can use right now to make money online in the dropshipping business from the comfort of your own home.Thousands of people just like you use eBay auctions on a daily basis to sell and buy products on the Internet; now it's your time to START your own dropshipping home-based business and succeed in the eBay auctions 'game'!There are no special skills required for this dropshipping business, all you need is a computer, Internet access and some basic computer / Internet knowledge. Attract eBay Buyers Like Crazy! As an ebay(TM) seller it happens very often (too often) that listings close without any bids. Did this happen to you? Many sellers are frustrated and quit their eBay(TM) business. Fundraising Ideas Using eBay Have you thought of using the online auction site eBay as your next major fundraiser?I have, and it was a huge success!Like many other businesses the fundraising business has seen an incredible change since the internet. Everyday there are new tools, softwares and websites that are making fundraising not only easier but a lot more fun. eBay Consignments: The Giant Opportunity Hiding on eBay (Part I) More and more, people are becoming aware that they have potential cash sitting in their closets, attics, and basements. But not everyone has the time or the know-how to tap into it, so these items remain where they are or are given away. How I Was Nearly Conned On Ebay I am not sure how many people have had bad experiences on Ebay, I hope not too many. I was having a great time on there until some man tried to defraud me out of £170. Selling Effectively on Ebay Motors Remember back when selling online was a new experience? Dealers tried everything to sell their vehicles online. Today's market has expanded to include several hot online marketplaces but there is the largest online marketplace, Ebay. Four Reasons Why You Should NEVER Use Animations In Your eBay Auctions Inexperienced auction sellers, or those lacking in confidence, often want to make their auction listings more dramatic and exciting. They dread the possibility that buyers will be bored by their auction and turn away with indifference. From Ebay Zero To Power-Selling Hero: What It Takes Have you ever wondered what it takes to be "the best of the best"; to outcompete everyone who tries to do what you are doing--and to keep them guessing exactly what it is that makes you so much better?If you've ever owned a commercial website before, you know who these people are: they're the ones who sell the same product as you, but make $200,000 each year doing it. They have top rankings on search engines, flocks of loyal visitors, and a mailing list with 500,000 subscribers. All Terrain Vehicles (ATVs) Sell Well On eBay ATV auctions are healthy markets on eBay. All terrain vehicles have changed in the last few years (naturally) and the major change has been from one person ATVs to two person models. Drop Shipping Your Way to Increased Profits Drop shipping, for those who are unfamiliar with it, is a system whereby you promote the products of a particular manufacturer, take orders directly, and the manufacturer/source handles all the inventory and fulfillment functions for you.In a nutshell, here is the drop-ship system:==>You generate and accept the order. eBay: Dont Believe All the Hype Three billion dollars (that's billion with a "B") in revenues, 135 million users, millionaires all over the place at eBay! Yeah, eBaby!!!, to steal a line form another great author. (See "EBay: No Way?Yes Way (Ten Seller Themes) by Barbara Snyder M. A WIN-WIN Scenario On eBay For Buyer/Sellers: Tips For Hunting Want It Now Postings "Ask And You Shall Receive" Policy Works!You're one-of-a-kind baby clothes sat for the last month on eBay with no buyer. Why? Perhaps your item is so specialized that buyers have a hard time finding you. How Pop-Culture Collectibles Can Increase Your Online Auction Profits How Pop Culture collectibles can increase your Online Auction profitsWith the increasingly competitive environment for products to sell in the online auction arena, sellers are getting more creative as to the items they purchase for re-sale.While some of the Dutch Auction items that are frequently sold on eBay will always maintain their commodity status and always sell well, Pop Culture collectibles will usually generate a higher profit-per-item simply because of a combination of two forces. eBay is the Greatest Opportunity YOU Have to Create a Career Online eBay's being spoken about everywhere these days. At work, school, down the pub. 5 Secrets for Increasing Auction Profits 1. Include your ebay seller name, store, and website information with all items you ship. The International Affiliate Program of EBay eBay trades in more than 33 international countries with over 157 registered users worldwide with 75 million based in the USA and 10 million in the UK.eBay's affiliate program must be the mother of all affiliate programs as far as size and potential scope for earning an income through promoting other peoples items. Garage Sales, Flea Markets, and Special Events... Oh My! The activity chart is an ingenious way to find, in order, events happening in your community throughout the day. Plug in 'www. The Powerful eBay Bidding Strategy That Claims A 99% Success Rate Don't you just love it?You've found that special item on eBay that you've just got to have!No If's Ands or Buts, you've got to win that item.You've checked and double checked the "End Of Auction" time and date and you're at your computer, signed in and raring to go at least 30 minutes before the auction ends.
|
| Article List | Index | Site Map |
|
All logos, trademarks and articles on this site are property and copyright of their respective owner(s).
The comments are property of their posters, all the rest is Copyright © 2006 CanadaSEEK.com - All Rights Reserved. |
