Selling Something on behalf of Someone (taxes)...

[Ruehl]

Ok, just want to know how to figure this out. Since I'm a Top Rated power seller, my friend wanted me to sell his watch on his behalf. It sold for $650 and I got the money in my Paypal. My friend will give me $100 bucks for my efforts.

$46.80 (9% from eBay | $58.50 final value - 20% Top Rated Seller discount)
$19.80 (3% + 30 cents from Paypal)
$12.55 (USPS Priority Mail Medium Flat Rate + Signature Confirmation)

Meaning, my share of profit is $20.85 which to me, is fair.

Just worried mostly about taxes. I'm hoping when tax time comes around, I can just report my profit from this sale as $20.85?

[KingRay]

That is exactly How it works. That works that way on everything thus the reason why its so important to keep records of every item you sell and what you make on each.

You pay approx 15% of what you actually make "NET". The whole amount will be reported but when you add all your deductions in then the tax liability will only be calculated on what you make NET

You must report the whole sale price "gross" and then the deductions will take care of the Net prices for you.

Just to be clear, you report the full amount on everything, Then pile on all the deductions at the end.