Does ebay's new 1099-K form mandatory for $600+ in annual sales require any estimated quarterly taxes to be paid to either federal or state branches? Will any added tax filing for ebay sellers be necessary prior to the standard annual filing procedure?

[CLBHESQLLM]

Hi @hobbysellebayer, generally as a self-employed person you do need to paid estimated quarterly taxes as you go along.  The 1099-K that you receive at the end of the year will go to the reconciliation with what eBay reported to the IRS.

There is no special filing requirement, as you would report all 1099s you received as part of your regular annual filings.

[Edited 9-25/24 9:26am PST]

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[hobbysellebayer]

Thank you.  I read through the quarterly tax link that you sent and found this general statement "If you don’t have taxes withheld from your pay by an employer or other payor and expect to owe $1,000 or more in taxes for the year, you typically need to pay quarterly estimated taxes".

With ebay now changing the sales reporting minimum from $20,000 in sales or 200+ items sold, and my hobbyist sales never having reached either of these numbers, this will be my first experience with the 1099-K.

Does the statement “expect to owe $1,000 or more in taxes”, refer to in my case ebay selling alone, or my household joint filing total?  In my scenario I file jointly with my spouse’s employer W2 annually, and each year receive a refund from the IRS as opposed to ever owing/paying them at filing time.

[CLBHESQLLM]

Hi @hobbysellebayer, good question.  Even though you are filing jointly, the SE applies to the self-employment income only, so the best rule of thumb is to base your calculation on the SE income only.  The instruction in line 9 of the form also guide each taxpayer to file separate forms to calculate the tax correctly, so hypothetically, if both you and your spouse were self-employed you would need to fill out separate 1040-ESs to calculate the tax, so it would be a good assumption that the $1000 applies solely to the SE income.