skyrocketing prices / CD sold on eBay

Of course assuming that you can still play a CD! Newer cars don’t have a CD player anymore.

How many people still have a gramophone/record player/turntable these days.

I still have a single play Swiss made “ Dual “ turntable but probably have not used it in 25 years. It has a drive belt but may have disintegrated over time.

Do people buy to speculate, or listen, with music, I bet majority is speculation. Interestingly I had two copies unopened--I wanted to hear them online, and could not find anything available, other than analog tape uploads (it's a live show from 1978), poor quality.

Anyhow another revelation--my friend said have fun with the 1099-K, this is all taxable income in 2022! wth

I still have a wind-up Victrola with replaceable needles and records that are still in albums labeled from A-Z, also some records recorded on one side only. It is around 1902 Was my great grandmothers when she first got married. Also, a 1921 Brunswick tube radio that still plays.

It may surprise you (it surprised me), but I saw an article a few days ago that said that vinyl records were the largest selling form of physical recording last year.

- Tom -

That's true, and it's growing, but it's a somewhat misleading statistic, because physical recording sales are way down in total, compared to a decade ago. Most people these days would rather stream music than own hard copies of it. And if they're going to "buy" it at all, they often prefer to buy a digital copy to vinyl or CD. But non-physical digital sales are also falling.

But we're getting off topic here. I tried to sell off vintage vinyl LPs five to ten years ago, some worn and scratchy, some much better (depending whether I bought them before or after I had a good phono turntable and cartridge) and there were few takers. They're also expensive to ship, and that's gotten much worse recently. I'll have to study eBay sales prices (not asking prices) and see if this is a better time to sell. I'm done with vinyl.

One other thing to be aware of, if you're selling collectables or other merchandise on eBay etc.: beginning for tax year 2022 (not tax year 2021 which you'll be filing tax returns for by April 2022), you'll be receiving a new tax form reporting payments of over $600 to you over the course of one year from a payment service, specifically Paypal and Venmo. The IRS wants its cut.

See: https://news.yahoo.com/paypal-venmo-irs-1099-k-150046194.htm...

Now if you sell a collectable for what you paid back when or sell it at a loss, no capital gains tax would be generated, but the IRS may ask you to document your purchase price data, which of course, most people have no way of doing. Sales of collectables for profit have always been taxable but the IRS mostly relied on self-reporting, and most people just ignored it. That may be harder to do now. Tax will be another factor in addition to website and e-payment fees and shipping costs sharply limiting ability to make more than minimum wage selling collectables. (Unless an item is worth maybe $40 or more, it's probably not worth your time to sell it on eBay, IMO. It takes a lot of time to list, manage, and ship sales.

I spent some time going through actual sales data on eBay over the weekend. (Keep in mind that only Sold Item prices on eBay give a realistic valuation for collectables. Asking prices are not a good indication of value.) Collectables being sold by johnnatash4 may be skyrocketing, but the ones I'm holding onto to "sell someday" have still gone nowhere in recent years, including this past year. This includes old LPs,CDs, toys, family pieces, etc. So obviously, john, you're a better "investor" than me when it comes to collectables. As always, it's all supply and demand; some collectable items are going to gain, and others are not.

Can you clarify?

What I read was yes, $600 generates a notification to the IRS.

At the same time, the fact that a 1099-K is issued like any other tax document, that will also include say my $216 sale, even though it's below $600.

Not only that, I read it's schedule D, not A.

So now, I have two never opened box sets that I paid $160 each for in 2019. They are selling on eBay now for $500-$550. I bought them in 2019, so that's long term, and not ordinary income. It still s****, but is a huge difference.

To be honest, I don't know that they will always be that price, so why not unload them. They have to be sealed/never opened to get that. So what if I sell for $500, buy back opened for $300. Although now it's not that easy with taxes and eBay fees being 14.55%.

But is it schedule D, and won't a $216 sale also be included? Or am I incorrect and it's ordinary income?

In researching your question, I discovered that residents of nine states (listed in the link below) and Wash DC actually *are* expected to receive 1099-K's for Paypal or Venmo payments >$600 for tax year 2021, because those states already had a lower taxable threshold in place that the feds will only adapt for tax year 2022, filed in 2023. In those states, this 1099-K income might need to be reported at least on 2021 state income tax returns filed in 2022.

This article lists the states and explains some more about the Paypal/Venmo 1099-K forms: https://www.ramseysolutions.com/taxes/1099-k

But that article doesn't really answer your question. I'm not a tax expert, and I'm sure they'll be figuring out over the next year how this will actually work on the 1040 forms for tax year 2022. But my reading is that the 1099-K is simply a report of a transfer of funds. You or your tax accountant will have to determine what part if any of the number appearing on the 1099-K is taxable, and where it would be reported, specifically as ordinary income, or capital gains income. Some funds transfers reported on 1099-K's from Venmo or Paypal would not be taxable at all, because they represented a nontaxable event like a $1000 transfer of funds between family members. For many taxpayers who received a number of Paypal/Venmo transfers during the year, the total number reported on the 1099-K would fall under more than one category of taxable or nontaxable income.

In the past, anything like a CD has been considered a collectible for tax purposes, and collectible sales for profit are reported on Schedule D, capital gains, now taxed at a lower rate than earned income, interest, and dividends.

I don't think that will change with the 1099-K you might receive if you sold over $600 a year in stuff like CDs. The 1099-K might report earned income as well, for people who take payment for, say, contracted services. Somehow the taxpayer will have to 'splain what that 1099-K number represents on the federal 1040 tax forms, yet to be determined.

Oh and if all you sell on eBay is one $216 CD box set, the buyer pays you with Paypal, and that's the only Paypal payment you receive during that tax year, no, you shouldn't even get a 1099-K from Paypal, or if you did, it would not be taxable, because that's below the $600 threshold. Sell three of those box sets at that price in one year, and you would expect to get a 1099-K form. And then you could report on Schedule D that you paid, say, $120 back in 1988 to buy the box sets, sold them in 2022 for $648, generating a long-term capital gain of $448.

That's my non-expert take on all this. For a more informed answer, let the accountants and attorneys argue it out.

Isn't everyone on ebay migrated to mangled payments by now?

Even if buyer pays with paypal, seller never sees it as a paypal payment, rather it's a payment to ebay which is then transferred to the buyer.

My account was migrated back in aug 2020 IIRC. When I did my taxes in 2021, I received 2 1099k's, one from paypal for 1/1/2020 through 8/x/2020, and another from ebay for period 8/x/2020 through 12/31/2020.

This year I expect to only get a 1099k from ebay.

Sounds like the IRS will need to hire a bunch more auditors to audit all of the new 1099-Ks.
Mark

it's simply automated? I mean if I'm not mistaken, I've been getting our tax refund in 2-3 weeks now.

How complicated is it, not very, standard deduction with schedule D, interest and dividends.

But the fact that the IRS can do it requires automation.

I still have a turntable and a vinyl collection but they sit unused. I actually bought a small pre-amp to put between the turntable and the receiver as modern receivers don't have a phono input. I used to have a nice United Audio Dual turntable but when we moved 32 years ago some clod plopped a bunch of stuff on top of it and broke it. I was not happy but it was free help and we had to move everything in a single day.

My truck has a CD player but it doesn't get used. My wife's old car (will sell it as soon as our daughter fixes her car so we can get our old car back) had a CD player and also internal storage. She put every CD she owned into the thing and ripped them all to the internal storage. It was actually pretty cool.