Quote:
Originally Posted by Cliff R
"ebay sucks, but it still has many benefits for sellers & buyers that are well worth the 12.9% fee..."
Those arsholes are ripping me off. I'm in the 14-16 percent bracket, I guess I need to get a better calculator as when I run the total for all sales against the pay outs it's over 15 percent. I guess they don't like me or I don't know how to structure my auctions correctly , or a little of both......
I'd also add that EVERYTHING you purchase related to selling and shipping ADDS to the cost of the items being sold, whether they are tax deductable or not. The small break you get being able to write it off still doesn't pay for those items. Matter of fact they want you to inventory all the items you have in stock at the end of the year and pay taxes on them. I doubt if too many small businesses are really doing that. Maybe that's why they hired 87,000 new agents and bought guns and ammunition for them. They better buy them body armor too, for when they come around knocking on doors wanting to spot check your inventory and business records...........FWIW......
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i think you might be doing the math wrong to come up with 14-16%, in that you arent factoring in all the items that get charged the fees. i could be wrong on that, but you cant just take the sale price of the item & subtract the total fees they are charging, the fees are charged on the shipping amount & especially the taxes ebay charges on the item.
look at one of your recent sales on ebay, there is a link called payment details, if you click on that they break down all the fees to show what they are charged on, it should work out to 12.9% + a .30 per transaction fee, at least thats the fee structure for all ebay motors sales of parts, other categories are different but are explained in the fees link i posted. if its not working out to that you can email or call them to point it out & have it fixed.
as for deductions, yes you are taking those expenses off the amount you pay taxes on, its not a 100% credit but you arent paying taxes on that amount. any items used for operating a business are part of operating that business, you factor it all in then set prices to make a profit, thats just how a business works. sucks to look at it that way but you gotta spend money to make money.
heres a little trick to help save money on shipping related expenses like driving to the UPS store, for smaller/lighter items up to about 4-5lbs, USPS is usually a lot cheaper than fedex/ups & they will pick up the item from your front porch for free!
the inventory at the end of the year is not fully taxed either, you subtract year end inventory from beginning year inventory to determine the net income for the year that you pay the ~13% SE tax on. they arent taxing the full inventory if it didnt sell that year. its confusing to discuss taxes but once you do them enough & understand how the flow of schedule c works you see how things like year end inventory works out.