What happens if I sell more than $600 on eBay?
Selling more than $600 total in goods on eBay during a calendar year triggers federal tax reporting requirements under IRS regulations. Online marketplaces and payment processors are legally mandated to issue a Form 1099-K to both the seller and the IRS once gross sales exceed the $600 threshold. Receiving a 1099-K does not mean you are taxed on your gross revenue; rather, it means the IRS has a record of your gross sales. Sellers are only required to pay income tax on actual profits, which is calculated by taking your total sales revenue and subtracting allowable business deductions such as the original cost of the items, shipping fees, packaging supplies, and platform selling commissions.
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