What can I deduct in my reselling business?
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- Опубликовано: 19 окт 2020
- Deduct everything you can! Most deductions are straightforward, but some are a bit tricky. In this video I'll review what deductions are, what the most common deductions are in a reselling business, and how to deduct some of the more complicated deductions.
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Great info again, Mark! Cannot wait for your next video and excited about what the next topic will be!
Hey! Thanks for provide such awesome value and content, I appreciate it greatly. Using your spreadsheets right now and it's helped me so much
Excellent video. Thanks so much! It was very understandable and you told me exactly what I was wanting to know. Look forward to checking out other videos here!😊
New subscriber alert. As a single member LLC. I am here to learn how to pay taxes, what deductibles are.. Etc Thank you Mark
Great advice and that’s is why I worked with you for my taxes in 2019 and plan to do so on 2020
Wait a minute? He offers CPA services online? Where do I get more info I need a CPA.
I appreciate your information regarding taxes..i learned a lot the interesting part about deductions..very informative..thank you..
Definitely learned something here! Never knew I could deduct 50% of meals when traveling, missed out on a few this year for sure haha. Thanks for the info!
Every little bit counts!
😳 how did I just find your channel? I’ve needed you! 😂
Thank you for this helpful information.
My ex husband handled all my reseller tax stuff. And since I'm decide, I took a break reselling, and just getting back into it. Being someone that already struggles with anxiety, your videos have been very helpful. I still have a lot to earn, and still nervous about doing my own taxes. But I've learned a lot.
How do I find how much I would be taxed for reselling? Is it 30% for everyone? What is this tax called or how would I search it on google? What key words and I looking for?
Great Great Video! Thanks!
Just started selling a large collection of inherited antique toy cars, and I have been uncertain on how to go about all these details. Your videos have been a huge help and I can’t thank you enough for presenting it in an easy to understand fashion!
Use Cash. This jerk will get you audited sho nuff.
You shouldn't be taxed on anything inherited?
Thank you so much for your valuable and helpful video. I am a single member LLC, and import my resell products directly from overseas factory, and having to pay over $20k on ocean freight charges, customs duties and local trucking charges. Where and how do I report as expenses on tax returns? Thanks again for your great video!!!
Wow EXCELLENT info thank you! I have a question about shipping charges on ebay: I always charge for shipping - so because "I buy the labels" do I deduct this as does and fees?
Thanks 👍♥️
Thanks for the info. One question I have if you could help. I make custom fishing equipment for a business, if I take a fishing trip to test out new equipment would the cost of the trip be deductible? Thanks
lEARNED A FEW NEW TRICKS I WILL SUBSCRIBE NOW.
This was very good ur great st this ... I live in Arizona do you help file taxes if we pay you. Last year I went to freetax usa and filed on there I had numbers of sales n donation and I left a lot of money on the table I only counted my inventory. Lol nothing else I ended up having pay 480 for tax and I was happy but mileage and all I left on table
Thank you so much for sharing your knowledge with the rest of us. Just started reselling earlier this year and have been getting stressed out thinking about tax time. Have saved all my receipts but no clue on the best method to go about this.
By chance to you recommend refer CPA Services that are helpful to us resellers if we are not in your area?
I’m in Phoenix, AZ.
I refer all resellers to me :) I do know some good CPAs in AZ but none that specialize in ecommerce.
@@notyourdadscpa 🤣😆
Clarity, as usual. 👏🏼 Are you sure you’re a CPA and not a teacher too? 😉 Thanks for the help! 😀
I'm flattered :)
@@notyourdadscpa I totally agree that you are a great teacher. Thanks for sharing so much information for this community!
Thanks for a great video! Are shipping charges from the post office deductible? Thanks for your help!
Definitely 👍🏻
I have dabbled in this for a bit- if we don’t live anywhere near you then do we use our regular tax preparer?
Hi, can I use dry cleaners as a deductions since I plan on using them for my resell business? Thanks!
Do you have any vids where you discuss the differences -- advantages and disadvantages -- for incorporating or creating an LLC vs. reselling as a sole-proprietor?
This 👆
Hi. How far away do you have to be from your home town to be considered travel? If i'm driving an hour away to source and spend all day in that area and have to stop for lunch at some point, then I end up driving home for the night. Would that be deductible? thanks
Hello if you just started a business and you are yet to register it and but received some payments on any of the payment platforms will you recieve a from from irs.? Payment received was not by sell on the web. Thank you
Thank you for this informative video! Quick question: Several times a year we go on a sourcing trip to thrift stores and flea markets in other states. Instead of staying in hotel rooms, we pull a travel trailer and stay in it at night. Could the campground fees be considered tax deductible?
Yes 👍
Awesome! That is so good to know!
Wondering how to account for buyer pays shipping, while using the cash method costs of goods sold inventory deduction. Shipping charges are part of my gross sales, when Mercari sends total gross sales, can I both record/(represent) these charges as 'fees' per item, (which technically won't be valuing my inventory) since it will be recorded as 'shipping fees' as the item sells. Or can I not represent these charges as part of my items with cash method? Ultimately, I have to lower the price of my inventory to account for shipping costs whether I pay for them or not. Would this qualify as a deductible business expense? because my sales report data is the total amount of gross sales and with the cash method I am recording costs as paid, therefore I will be taxed against my total sales which gives the IRS my profit vs total costs of business. But then these shipping charges are not accounted for, which are very considerable, meaning I will be paying 15% profit on these charges as sole proprietor cause lumped together with gross sales. How do I take a deduction on this? Or am should I switch to free shipping?
So in order to get all of these deductions, I would have to itemize instead of taking standard, correct? They increased the standard so much that it's almost impossible to make out better by itemizing.
What if you model the clothing that you’re reselling and sometimes you need to purchase some basics that you utilize to properly style the items you’re trying to sell? Can those clothes or shoes be an expense that you can deduct even if you’re not planning on reselling them?
From my understanding as long as it's for business use and not personal use then you can write off. I'd look at it more like a display prop to appeal your items.
I have always used the standard deductions allowed by the IRS.
That’s not the deduction he’s referring to. What he’s talking about is deducting the expanses you have for doing business
Great Video! Question: I run my resell business out of a home I rent. My rent is $2200 a month. How much of that is deductible?
Percentage you use to store your items
Let’s say I sold 10k worth of stuff on eBay and transferred the funds to my PayPal everytime I withdrawl money does that mean I have to pay 10k tax worth for eBay and 10k worth of PayPal?! Or does it know I’m just withdrawling the funds thru PayPal, rather then making a sale on paypal? Im so confused.
Can you deduct a start up cost of an automation Ecommerce store ?
Hey Mark, are "Staff Meals" still deductible?
During tax season I imagine you are working extended hours. Say you provide lunch/dinner to your entire staff so they can work > 8 hours without taking time off to prepare a personal meal, wouldn't that be 100% deductible as a staff meal?
Say a reseller operating a single-member LLC puts in a 12 hour day travelling around their state on a sourcing trip, might they also be able to justify providing themselves staff meals on those extended days?
How do I find how much I would be taxed for reselling? Is it 30% for everyone? What is this tax called or how would I search it on google? What key words and I looking for?
Are you performing CPA business? I need help to get my taxes straightened out. Or do you have a HOUSTON TX CPA to refer? Thanks in advance.
90% of the time I am sourcing out of town, so all these meals can be deducted by 50%?
What If you started reselling last year and you don't have a business license. Are you still able to deduct when coming to tax time this year?
How would they know how much you spent on inventory at yard sales? Could you use ATM withdrawals as deductions spent at yard sales?
I watched a video where the reseller used his ATM withdrawal for example of $100 and spent the same amount to buy in a garage sale or flea market
Help. Still doing 2022 taxes. (Don’t judge) I’m filling out schedule C. Where do I record the ‘Taxes and Government Fees’ from my eBay report? Or do I. It’s included in gross sales, so, don’t I record it? I know I never collected those taxes, but…if Im required to claim my Gross Sales according to eBay, don’t I need to show those sales taxes were paid?
Thanks Mark! You explain things so well:)
Can anyone help me here???
I just started reselling for profit this year (not much profit yet LOL). I don't have receipts for everything but I've printed and highlighted business expenses on my bank statement(have failed to use account exclusively for business). Should this be enough for tax time? I will do better next year:(
It's better than nothing! I wouldn't worry about it. The IRS typically doesn't care about receipts less than $75. And even if you don't have a receipt, don't let that stop you from taking a legitimate deduction.
@@notyourdadscpa that's so good to know! I wasnt very organized last year. I do have most receipts but not all for items purchased through good will so I'll have my bank statement.
I purchased a Laptop for $950 in November 2021, mainly for business uses throughout 2022. Can i still write it off for my 1099 K 2022 taxes when i get them in 2023??
Question: how does one determine the percentage of costs to write off? For example, I have a storage unit with inventory as well as personal items. Do I write 50% of my bill? Other examples are my cell phone service, internet, electricity and rent at my apartment. How do resellers do it? Thanks
Also have the same exact question
Thank you for such great information!
But I couldn't help myself the entire Video thinking if those are Packed Kilos of Columbian Cocaine behind you? lol :)
May i deduct PPE? Masks and gloves?
I resell my clutter at depop I made one sale every 3 months or so . They are requiring me to get a tax is and I am pretty ignorant about the subject and I don’t want get a tax id if that means I will be force to fill my taxes as a reseller for a $20 sandals . I would highly appreciate you guide me and let me know if that tax id is something that could hurt me and it’s better quit depop
How do I find how much I would be taxed for reselling? Is it 30% for everyone? What is this tax called or how would I search it on google? What key words and I looking for?
Hi, a product bought with a gift card that I earned from doing online surveys or other online rewards program and then selling them, how would I count COGS? Would they be 0 because the item I bought cost me basically nothing? Thanks
Yes, that's the simple way to do it. You could include the value as income and then deduct that same amount as COGS, but it all ends up being the same as if you just count it as zero initially.
@@notyourdadscpa what if you buy a product with a gift card as stated above and get a full rebate through PayPal. Is the rebate considered profit and then subject to tax?
Does all this apply in Canada or???
Do you have to purchase something in the name of your business (such as your LLC) in order to deduct it, or can you deduct any item you purchased, whether it was under the business name, or something you purchased under your name? Same question in regard to which funds are used to make the purchase, personal account or business bank account?
I resell as a side hustle. Do i have to have business license in order to deduct on reselling expenses? Thanks
Yes You need a resellers License/Business license LLC.
uncle sam wants his share.
Im in Nevada l fly to Florida 2-3 x a year for the huge community sales and the outdoor swap meets anything l f find l ship back.lm going there to make money can l write this off.
So be qualified for a tax reduction u need to be a business? I’m just selling on Mercari never got a llc or business license so will I be able to use deductions?
I want the details too on that
Same question
even a small discount on shipping can make a huuuuge difference. 30% is alot .
I'm renting a shed for ebay stuff can I deduct my monthly rent as a expense
what happened to mark one?
If I understood correctly, you can deduct for contractors? So, does that include hiring someone to clean my room where my inventory is kept? What about a whole house cleaner?
Contractors that perform services FOR the business yes. Whole house cleaner typically not. I believe you could probably deduct the portion associated with the inventory space/home office. I need to confirm that.
@@notyourdadscpa neat! Never thought of it before
HELP HELP HELP……………………someone said if your not registered as a business that there is a 2% floor is that true, does that mean you can only write off up to 2% of expenses? Even if your just side hustling should you register as business?
How do you account for reselling supplies if you pay for them out of your personal bank account instead of your business account especially when getting started part time?
You can still count those as deductions on your tax return. From a bookkeeping perspective the business can either reimburse you for those which would show up as an expense on your books, or you can show it as an equity contribution.
What if your just selling your own property so you can retire?
Hello, do you recommend having a llc.
Just depends! The main benefit is liability protection. It generally won't impact your taxes.
Hi Mark I started selling my own stuff in Poshmark Oct 2019 and didn’t pay taxes until 2022 as this was only a “hobby” as explained by my tax advisor! Fast forward 2022! I hired a virtual assistant and also moved to another state and made $22K as of December 15! Now I have to do 1099 but I don’t even have a license ! Would you advice me to get one or am I already in big trouble ?
Question about COGS. I am selling items on Poshmark that I no longer wear. Many items still have the tags. I have the order confirmation from my original purchase. If I sell and item that I originally bought for $250 a year ago for $50. Could I report my COGS is $250?
It seems like normally, COGS is less than what the item sells for but when selling old clothes that decrease in value, the COGS is higher.
Check out my video on personal items. You'll use the lower of the original cost or the market value at the time you contribute the item to your business inventory. The market value is fairly subjective.
I have a question, since the new law that pay pal will send us a 1099K with credits of $600 or more. I play a virtual game online and create different sims for the game. I will purchase textures, objects, etc that will go into creating these sims. I will then be reimbursed through the same game when a project is completed. I never actually make any money, my debits are way more then my credits. So how will this work? Thank you in advance.
I should also add that the debits and credits in pay pal come from Tilla so the IRS can easily see the debits are more then the credits.
Reimbursements are not taxable, and expenses you are reimbursed for are not deductible. If you get a 1099, in order to avoid confusion with the IRS, just report all the reimbursements you receive, and add as deductions, and the difference is what will be taxable.
Can you deduct your cpa tax filing fee from yr prior?
Yes at least partially if you have a business. You can deduct the business portion of the tax fee.
Do I need a reseller license if I’m selling on Poshmark? I want to sell clothes and shoes I don’t use
No you do not
How do I become a " business " ?
Just start! You are a sole proprietor by default.
download not working
Just tested it, and it worked on my end. Let me know if you still don't have any luck and I can send it to you.
It's work on my side, check your email .. and that is awesome thank you.
Hi, it takes my name and email then i click download now and it goes to another page and says your information has been received then there is a return option .. never see any download happen @@notyourdadscpa
ok i got it in email.. sorry @@notyourdadscpa
Can't you deduct your cost of items as well
Yes definitely, that will be your cost of goods sold
But what if you sell on eBay, but are not a business? in the usual sense, but just reselling your own stuff. I paid taxes on items already, when I purchased them. Why am I required to pay tax again? I know its now the law, but how does this help anyone? or our country. Lets just make sure no one can eat huh Joe.....
Such a real nigga