Paying Tax on profits gained from sneaker selling

[irishbaz]

Does anyone know the tax implications from selling sneakers for a profit? If sales tax was originally paid on the sneaker does that negate any further tax from sales?

Im seeing a lot of guys selling off collections lately and I always wondered what the tax implications are when profits run into the tens of thousands from sneaker sales?

I mean retailers got to pay tax on profits they make from selling and consignment stores selling sports memorabilia got to pay tax on sales so how is it any different?

The avg collector selling off 50 pairs is not so liable unless it’s a bunch of yeezys or similar high profit shoes but guys with hundreds of shoes would be making high profits on DS shoes they are selling.

If you consider stocks and shares then there are taxes to pay when you sell shares for a profit?
I’m just opening this up for discussion as I’m interested to know the IRS implications on reselling sneakers on a high volume scale.

 

[ninjahood]

i doubt these folks paying capital gains taxes on anything like sneaker liquidation

 

[irishbaz]

A lot depends on the volume and the avg profit per shoe, 100 pairs of yeezys has substantally more more profit than 100 pairs of nmd etc, but for a couple hundred shoes that aree DS kept for 3-5 yrs making an avg profit of $50-100 per pair thats $15k+ capital gains, 100 pairs of yeezys would amount to over $30K+ in profits...

 

[diego]

You guys playing the game all wrong.
Many many years ago I had an accountant make it look like I had a sneaker online business that was losing money.
Lead to some tax breaks for the kid.

 

[rich4eva]

^
you sir, were advised well.

 

[alp]

You're not subject to tax unless you sell over two hundred a year on PayPal and $20k in sales, so if you sell 160 shoes online in a calendar year you pay $0 in taxes, and you can write a lot off

 

[mr jordan04]

You guys playing the game all wrong.
Many many years ago I had an accountant make it look like I had a sneaker online business that was losing money.
Lead to some tax breaks for the kid.

You stopped doing that?

 

[hennessy]

You're not subject to tax unless you sell over two hundred a year on PayPal and $20k in sales, so if you sell 160 shoes online in a calendar year you pay $0 in taxes, and you can write a lot off

If reselling goods is your primary (or only) source of income then you need to set up a business and pay taxes on gross sales. Classify retail prices as cost of goods sold. Pay tax on your profits.

For tax years after 2017, you are no longer eligible to take a deduction for hobby expenses. Running a hobby as a business could very possibly trigger an IRS audit. If your business is legitimate, keeping accurate and extensive records could help prevent the classification of your business as a hobby.

 

[calibeebee]

Damn I’m way outta the loop. When’d Alp get banned and what’s his new SN?