Auto limited when reaching $2500

[john007]

I read somewhere that Paypal will auto limit you when you reach this threshold requiring you to provide documentation.

[JamesNorth101]

Where did you read that?

[yankee]

Not $2500.00 That would be asinine although I think the IRS law is also asinine

20K and 200 transactions. You then have to add tax information. It is an IRS law and goes for all credit card processors in the USA.

Been this way for years in the USA.

[JamesNorth101]

Its worth noting that the $20k and 200 can also be done on forecast.

[yankee]

Also worth noting that the IRS law states AND but PayPal most often monitors OR. Sell 150 $10.00 items in January and they ask for tax info even though you are not close to 20K.

[GreenBean]

Originally Posted by john007

I read somewhere that Paypal will auto limit you when you reach this threshold requiring you to provide documentation.

I think you are misreading and putting 2 & 2 together and making 7.
Your currency is incorrect.

2500 is related to the UK paypal anti-money laundering limits of £2500.


USA has regulations regarding IRS tax requirements of 200 items and $20,000 in sales.

They differ big time.


Another tip for future posts is to quote a source, if you can. In this case there would be no source.

[RosieTosie]

Originally Posted by JamesNorth101

Its worth noting that the $20k and 200 can also be done on forecast.

In reality however anyone's chances of selling enough to even start to pay tax on their income from it is increasingly remote and getting more remote every day!

[jeffweico]

Originally Posted by RosieTosie

In reality however anyone's chances of selling enough to even start to pay tax on their income from it is increasingly remote and getting more remote every day!

I wouldn't necessarily say that... It all depends on what you sell.

But I understand what you are saying. The average profit on $20,000 in sales is about $2,000 (figured at 10%, profits average 7% - 12% according to experts) and if that were your ONLY income, then yes, you would not be earning enough to pay taxes on it.

Many people earn money on eBay part-time though, and some of us have a full time income from selling on eBay and other sites.

I just wish eBay was the same way it was back in 1985. The money was UNBELIEVABLE! Back then, just about EVERYTHING sold and for a good price. But it is much more competitive now and eBay diluted categories to such an extent that there are not as many eyeballs looking at your items. So, sales are fewer and less profitable, GENERALLY SPEAKING. I use that term because, again, it all depends on WHAT you are selling.

[trosky]

So Jeff in your opinion and experience, do you plan all your items to get at least 10% profit from each? I struggle sometimes on higher priced items ($150+) since they affect your account more in terms of more risk involved in moving the money through PayPal and also it has a more impact on the account selling limits. I find that on a $200+ item I need more profit than on a $30 item to compensate for that risk and impact on my selling limits and also those sales bring the account closer to the tax requirements

[vogeltron]

Originally Posted by trosky

So Jeff in your opinion and experience, do you plan all your items to get at least 10% profit from each? I struggle sometimes on higher priced items ($150+) since they affect your account more in terms of more risk involved in moving the money through PayPal and also it has a more impact on the account selling limits. I find that on a $200+ item I need more profit than on a $30 item to compensate for that risk and impact on my selling limits and also those sales bring the account closer to the tax requirements

The 1099k for stealth has hurt big time for most of us in the USA. The first year with PayPal it was either or. If you sold 500 items but well under $20k it was cool. Now it is either or. Its difficult to deal with. I am grateful to be able to sell and make a living. But no question it is getting more and more difficult. Stealth in the U.S is not for the faint hearted.

[pokerpro]

You poor guys working on that meager profit margin.......I can't tell you my margin, because you would't believe me....but I feel you pain.

[yankee]

2x 4x and even 8x your money is not impossible. Looks at the people like aspkin who sell a product they create once over and over again. The margine is infinite

[trosky]

Originally Posted by vogeltron

The 1099k for stealth has hurt big time for most of us in the USA. The first year with PayPal it was either or. If you sold 500 items but well under $20k it was cool. Now it is either or. Its difficult to deal with. I am grateful to be able to sell and make a living. But no question it is getting more and more difficult. Stealth in the U.S is not for the faint hearted.

It seems that way, it's looking like if you want to sell as much as possible you better have 20+ accounts and rotate because each one will only last 3-4 months max to reach 150+ sales where you have to stop selling on it, unless you start getting EIN for each which it's worth it but a pain and like you said not everyone is up for it

[trosky]

Originally Posted by pokerpro

You poor guys working on that meager profit margin.......I can't tell you my margin, because you would't believe me....but I feel you pain.

Congrats to you! It all depends on what type of items you sell, most resellable new items made in China in big quantities will not have higher margins unless you buy direct from manufacturer or you have rights to it to limit competition. But as soon as you go with wholesalers the profit margin drops significant!

Don't you sell mostly antiques? I might be confusing you with someone else but on unique items like that obviously the margin will be higher as people are not shopping on price or know where to get it cheaper so they will pay higher prices. I always try to look for items like that not easy either

[pokerpro]

Yes, I sell collectibles......Antiques are much fancier than the stuff I sell. lol.........

[secret storm]

Has anyone here ever goten there paypal account limited the very second you had $2500 in the account that was from the USA ?

[GreenBean]

No, never.

Not sure why you are asking, secret'?

[SamuelJackson]

2,5k eur , that could be tho. (Europe)
However, not neccesarily a limit but they could ask for some further documentation regarding your business and that could/most probably will come along with a limitation.

[masimo]

how much is 2.5k euro in dollars?