Does anyone use Poshmark?

[Gennas]

These days, when they ask me how I want my receipt, I always ask for it in my email. That way, I can always find it.

Great idea! I will do that from now on.

 

[Gennas]

Actually since you already filed, there would be no reason to file an extension. You can submit a revised return at any time, even years later. The only issue is that if you owe more taxes than you paid with your original return, you could owe a penalty.

Yes, I think my accountant was going to submit a revised return. I will owe more in my taxes with this PM 1099K form, I don't want to have to pay a penalty.

 

[GemsBerry]

I'm mad. I already paid my accountant $350 before i got my 1099K. I emailed him the next day when I found out about the 1099K form. I wanted to see if he can cancel the efile or update it. He said to just wait until I get my 1099K and he will refile my taxes. He now says I either owe $10,000 if I mark this as a business or I can go through each sale and mark the one's that I made a profit on. He said I cannot take out the 20% commission that PM makes, I can't take out the shipping fees, or the cancelled and refunded items. What!!!!It was not a business. All of the clothes I'm selling are clothes I bought between 2019 and 2023. I bought them for myself. I'm selling them now, because I have way too many clothes. The majority of the items I've taken a loss on. Now he's saying I owe him another $350 to resubmit new taxes. BTW I feel he's taking advantage of me by charging another $350! He could have easily cancelled the first e file of my taxes. Advise please?

Don't freak out just yet. You owe taxes only on profit (gross minus cancellations, fees, COGS). Your accountant in the wrong saying you need to pay tax on everything and can't subtract fees, cancellations etc. You absolutely CAN, either in business or personal. Costs of good sold should be backed up by receipts, that's how your determine profit or loss.

I don't understand why your taxes would be higher filing as a business. If you use schedule C, you can deduct your expenses, including poshmark's fees and cancellations, and your taxes won't be as much. Filing as personal, you can't deduct any expenses and have to pay taxes on the gross amount.

The only items that would be eligible to file as capital gains/losses would be certain collectible items such as jewelry. Clothing and purses don't qualify as far as I can tell.

I don't agree that the gross amount in 1099-K including fees and cancellations are taxable. Itemize sales in Schedule D. Only profit is taxable.
Here's a useful link https://www.nstp.org/article/what-to-do-with-form-1099-k-

 

[whateve]

Don't freak out just yet. You owe taxes only on profit (gross minus cancellations, fees, COGS). Your accountant in the wrong saying you need to pay tax on everything and can't subtract fees, cancellations etc. You absolutely CAN, either in business or personal. Costs of good sold should be backed up by receipts, that's how your determine profit or loss.


I don't agree that the gross amount in 1099-K including fees and cancellations are taxable. Itemize sales in Schedule D. Only profit is taxable.
Here's a useful link https://www.nstp.org/article/what-to-do-with-form-1099-k-

I don't believe you can use schedule D for sales of clothing. It isn't considered a capital asset.

 

[whateve]

That is what I don't want to happen. The last thing I want is an audit!

I assume you aren't going to end up reporting a loss from your sales. You'll still have a profit, it just won't be as much as the 1099. I think that makes it a low audit risk.

 

[GemsBerry]

I don't believe you can use schedule D for sales of clothing. It isn't considered a capital asset.

I sell luxury and jewelry, I will use it. Since these threshold changes took place and forms were not yet adjusted, definitely you can use forms to subtract cancellations, fees, show profits and losses. You are absolutely not paying taxes on total reported in 1099-K. Even Poshmark says it clearly, you are not paying on what's reported in 1099-K, you only do on withdrawals amount. And from there you show profits and losses (Form 8949, Sch D) like I posted in the link above for personal or Sch C for business.

 

[Gennas]

I sell luxury and jewelry, I will use it. Since these threshold changes took place and forms were not yet adjusted, definitely you can use forms to subtract cancellations, fees, show profits and losses. You are absolutely not paying taxes on total reported in 1099-K. Even Poshmark says it clearly, you are not paying on what's reported in 1099-K, you only do on withdrawals amount. And from there you show profits and losses (Form 8949, Sch D) like I posted

Thank you so much for your great advice! Yes, I'm trying to not stress out. I'm going to find a new accountant for next year. I feel like this current one doesn't know what he's doing.

 

[Gennas]

Don't freak out just yet. You owe taxes only on profit (gross minus cancellations, fees, COGS). Your accountant in the wrong saying you need to pay tax on everything and can't subtract fees, cancellations etc. You absolutely CAN, either in business or personal. Costs of good sold should be backed up by receipts, that's how your determine profit or loss.


I don't agree that the gross amount in 1099-K including fees and cancellations are taxable. Itemize sales in Schedule D. Only profit is taxable.
Here's a useful link https://www.nstp.org/article/what-to-do-with-form-1099-k-

Thank you! Yes, I feel my accountant doesn't know what he's doing.

 

[Gennas]

Don't freak out just yet. You owe taxes only on profit (gross minus cancellations, fees, COGS). Your accountant in the wrong saying you need to pay tax on everything and can't subtract fees, cancellations etc. You absolutely CAN, either in business or personal. Costs of good sold should be backed up by receipts, that's how your determine profit or loss.


I don't agree that the gross amount in 1099-K including fees and cancellations are taxable. Itemize sales in Schedule D. Only profit is taxable.
Here's a useful link https://www.nstp.org/article/what-to-do-with-form-1099-k-

My accountant said it will cost almost double of what he's charging me now if he has to fill out the Schedule D form and list all of my items I sold. I already paid him $350 to just efile my personal taxes in Feb. That was before I knew about the 1099K. Now he said he has to refile my taxes. He said I owe him another $350 to do that, but it would be $650 or more to itemize the sales in Schedule D. Would I be able to do this myself? Or should I find someone else to do this?

 

[whateve]

My accountant said it will cost almost double of what he's charging me now if he has to fill out the Schedule D form and list all of my items I sold. I already paid him $350 to just efile my personal taxes in Feb. That was before I knew about the 1099K. Now he said he has to refile my taxes. He said I owe him another $350 to do that, but it would be $650 or more to itemize the sales in Schedule D. Would I be able to do this myself? Or should I find someone else to do this?

If you trust yourself, it isn't that difficult. You could try Turbotax online. They don't charge you anything until you file so you have a chance to decide if you can do it before you pay.

We used to use an accountant to do our taxes. Then one year our investment firm gave us Turbotax for free so I decided I would do the taxes even though I had already delivered the data to the accountant. Once the accountant was done with our taxes, I discovered 3 mistakes she did that cost us a lot more in taxes. When I pointed them out to her, she didn't apologize or reduce our bill, just made the changes. After that, I've done the taxes myself. It helps because I understand what is going on. I'm not blindly trusting someone else.

 

[Gennas]

If you trust yourself, it isn't that difficult. You could try Turbotax online. They don't charge you anything until you file so you have a chance to decide if you can do it before you pay.

We used to use an accountant to do our taxes. Then one year our investment firm gave us Turbotax for free so I decided I would do the taxes even though I had already delivered the data to the accountant. Once the accountant was done with our taxes, I discovered 3 mistakes she did that cost us a lot more in taxes. When I pointed them out to her, she didn't apologize or reduce our bill, just made the changes. After that, I've done the taxes myself. It helps because I understand what is going on. I'm not blindly trusting someone else.

That's a great idea. I would love to do my own taxes. I might try this weekend and see if I can figure it out. I can't believe your accountant didn't apologize or reduce your bill. I would never go back to her. I really do need to my own taxes. How do I refile though? My accountant already filed my personal taxes in Feb. Can I just refile again? Hi, I just got onto the Turbotax website. Where do I find the Schedule D form? My personal taxes for 2023 have already been filed, so what do I do now? Don't I just fill out the Schedule D form and submit that?

 

[Gennas]

I emailed my accountant and this is what he said "
"we can report it on Schedule D. But there are two things you must consider."

1. We have to list every single item sold. If you sold 300 items, we have to list all 300 items. This would cause your tax preparation fee to increase a considerable amount because I would have to spend hours inputting all this data.
   1. But for your tax return, I was planning to simply report “personal items sold” instead of listing each individual piece.
2. The clothing sold within a year is still taxed at your ordinary tax rate. Your Federal tax rate is 22%. Your California tax rate is 8%. This is total 30%. If your net profit is $20,000, you would owe $6,000 in taxes. Only the clothing sold over a year after purchase is taxed at the lower 15% Federal rate and 8% California.
3. The IRS does not allow taxpayers to take a loss from selling personal property. Therefore, you would only be reporting the clothing sold for a net profit. I’m unsure if this would result in a larger profit."

What do you think I should do? Again, I already paid him to file my 1099 and personal taxes in Feb. I paid $350 for that. Now he's saying this. It sounds like he doesn't want to do file a schedule D.

I don't want to get audited. Should I just try to figure out how to fill out a Schedule D myself and then file it?

 

[whateve]

I emailed my accountant and this is what he said "
"we can report it on Schedule D. But there are two things you must consider."

1. We have to list every single item sold. If you sold 300 items, we have to list all 300 items. This would cause your tax preparation fee to increase a considerable amount because I would have to spend hours inputting all this data.
   1. But for your tax return, I was planning to simply report “personal items sold” instead of listing each individual piece.
2. The clothing sold within a year is still taxed at your ordinary tax rate. Your Federal tax rate is 22%. Your California tax rate is 8%. This is total 30%. If your net profit is $20,000, you would owe $6,000 in taxes. Only the clothing sold over a year after purchase is taxed at the lower 15% Federal rate and 8% California.
3. The IRS does not allow taxpayers to take a loss from selling personal property. Therefore, you would only be reporting the clothing sold for a net profit. I’m unsure if this would result in a larger profit."

What do you think I should do? Again, I already paid him to file my 1099 and personal taxes in Feb. I paid $350 for that. Now he's saying this. It sounds like he doesn't want to do file a schedule D.

I don't want to get audited. Should I just try to figure out how to fill out a Schedule D myself and then file it?

Do you already file a schedule D? You would use it for investments, like if you sold stock.

This is what Schedule D looks like: https://www.irs.gov/pub/irs-pdf/f1040sd.pdf
If you wanted to list each item, this is the form you would use (in addition to schedule D): https://www.irs.gov/pub/irs-pdf/f8949.pdf

See all the information that is required? Do you have all of it?
You can just file out these forms without using a tax program. Each form on the IRS website has an instructional page also.

I've only done an amended return once. It has three columns for each item. You have to put in the numbers from your original return, then put in your changes. Then you would attach your Schedule D and 8949.

That's a great idea. I would love to do my own taxes. I might try this weekend and see if I can figure it out. I can't believe your accountant didn't apologize or reduce your bill. I would never go back to her. I really do need to my own taxes. How do I refile though? My accountant already filed my personal taxes in Feb. Can I just refile again? Hi, I just got onto the Turbotax website. Where do I find the Schedule D form? My personal taxes for 2023 have already been filed, so what do I do now? Don't I just fill out the Schedule D form and submit that?

Do they give you an option to do an amended return?

I think at this late date, it might be too much for you to do on your own. Personally I think doing a schedule C would be easier than schedule D and 8949, but getting advice on the internet may not be the smartest. Does the guy who is doing your taxes work for himself or for a company? If he works for a company, maybe you can ask to speak to his supervisor or someone else in the firm.

 

[onlyk]

I emailed my accountant and this is what he said "
"we can report it on Schedule D. But there are two things you must consider."

1. We have to list every single item sold. If you sold 300 items, we have to list all 300 items. This would cause your tax preparation fee to increase a considerable amount because I would have to spend hours inputting all this data.
   1. But for your tax return, I was planning to simply report “personal items sold” instead of listing each individual piece.
2. The clothing sold within a year is still taxed at your ordinary tax rate. Your Federal tax rate is 22%. Your California tax rate is 8%. This is total 30%. If your net profit is $20,000, you would owe $6,000 in taxes. Only the clothing sold over a year after purchase is taxed at the lower 15% Federal rate and 8% California.
3. The IRS does not allow taxpayers to take a loss from selling personal property. Therefore, you would only be reporting the clothing sold for a net profit. I’m unsure if this would result in a larger profit."

What do you think I should do? Again, I already paid him to file my 1099 and personal taxes in Feb. I paid $350 for that. Now he's saying this. It sounds like he doesn't want to do file a schedule D.

I don't want to get audited. Should I just try to figure out how to fill out a Schedule D myself and then file it?

According to your accountant, you could focus on your net profit now, such as say
You total sale was $75,000, if you made net profit of $10,000, go find records of that $10,000 and summit, if was total loss, then gave a figure of your loss is such as say -$15,000 after your calculation and summit.

TurboTax cost about $80 to $100

Your biggest obstacle right now I think is time, you may not have that much time to find a new trustworthy reliable accountant to do the amendment, you have a few days to try then decide.

 

[Gennas]

Do you already file a schedule D? You would use it for investments, like if you sold stock.

Do they give you an option to do an amended return?

No, I have never filed a schedule D. I don't know if my accountant was going to plan on filing this one as an amended return or not?