Originally Posted by nephinfan
Ok, basic question here in regards to paypal. Do we start keeping track of these transactions starting Jan. 2011? Or do I need to dig up all my 2010 transactions to turn in this year to my CPA?
Paypal gives you all of your transactions. If you go in to Reports, it has multiple ways to do it. You can download the whole year or by months.
In my opinion (and I have no background in taxes, etc). If you do XX,XXX.XX in total sales for 2011 on eBay/Paypal & file that on the tax return WITHOUT filing anything for 2010, I think the IRS is going to take a look at previous years.
I think that the new rule for the people who will get 1099s & file for the 2011 year of business only because they are "forced to", I think they are going to look back further in to their eBay "business" because substantial figures like that don't come from no where.
And if they look back & see you've been on eBay for the last 3, 4, 5, 6 years+ and haven't done anything about it until the 1099 year, I think you're going to be in a bad position.