EBay says: "Starting on Jan 1, 2022, the IRS requires us to collect each sellers 9-digit SSN or ITIN in order to send a. Customer: Hi! eBay says: "Starting on Jan 1, 2022, the IRS requires us to collect each sellers 9-digit SSN or ITIN in order to send a Form 1099-K to those who sell $600 or more."
eBay sellers must provide their Social Security number (SSN) upon signing up on eBay. This new rule took effect in 2022, following the Internal Revenue Service (IRS) rule. This change does not apply to all eBay users or sellers who generate less than $600 in sales per calendar year.
Fundamentals of the $600 Rule
Under the latest tax laws, such a threshold has been drastically reduced to $5000 in 2024 and $2500 in 2025. The plan for 2026 is that if an individual receives $600 or more in payments through eBay, the platform is required to issue a Form 1099-K and report all the earnings to the IRS.
The Reporting Threshold for eBay Sales
As a platform, eBay is required to issue Form 1099-K to sellers who generated more than a certain threshold. Under updated IRS rules, this threshold has a lowering trend. The mentioned threshold is $5000 for 2024 and $2500 for 2025. It is planned to be reduced to $600 for 2026.
Getting Form 1099-K from eBay
If your sales hit the payment threshold, eBay must prepare and send 1099-K copies to the IRS and to you by January 31 of the following year. IRS 1099-K payment reporting thresholds by year: $5,000 in 2024. $2,500 in 2025.
Your Form 1099-K will show payments received for sales on eBay. It will include the gross amount and number of transactions, your name, address, and tax ID. Forms 1099-K will also be reported to the IRS and the correct state tax authority, where applicable.
We're required by law to ask for your 9-digit SSN or ITIN or EIN for each account you have with eBay. We will only use this information to pay you, verify your identity, and for tax and consumer protection purposes. Maintaining accurate information from our sellers ensures there are no payout delays.
You should be careful about sharing your number, even when you're asked for it. You should ask why your number is needed, how it'll be used, and what will happen if you refuse. The answers to these questions can help you decide if you want to give out your SSN.
Anyone can refuse to disclose his or her number, but the requester can refuse its services if you do not give it. Businesses, banks, schools, private agencies, etc., are free to request someone's number and use it for any purpose that does not violate a federal or state law.
While Social Security is unlikely to disappear, it may undergo changes. Nevertheless, you can take proactive steps now to prepare for potential changes and protect your future retirement income.
Most of the time, it's OK to say no to schools, doctor's offices, sports clubs and many other organizations that may ask for this nine-digit identifier. In fact, safeguarding SSNs is a key first step to protecting against identity theft and other fraud.
2024 tax year Form 1099-K threshold
For tax year 2024, eBay and other online payment platforms are only required to report transactions to the IRS once you hit an annual threshold of $5,000 in gross payments with no transaction minimum. Prior to 2024, the threshold was $20,000 and at least 200 transactions.
Yes, we have a buyer exemption system that allows you to submit tax exemption certificates to eBay and make purchases without paying tax. Upload your tax exemption certificate. Learn more about eBay's Buyer Exemption program for sales tax.
Effective February 2025, ebay will hold private sellers funds for 14 days if the order is posted with an un-tracked delivery service (such as Royal Mail 2nd Class).
The 2025 tax year criteria for receiving a 1099-K include both processing more than $20,000 from more than 200 transactions within a calendar year, being subject to backup withholding, or residing in a state with a lower reporting threshold.
Key takeaways
Whether or not you have to pay income taxes on eBay sales depends on the nature of your sales. If your eBay gross sales add up to more than $20,000 and 200 transactions in a year, eBay will send you a Form 1099-K, which lists the total amount of payments you received throughout the year.
If you made a profit or gain on the sale of a personal item, your profit is taxable. The profit is the difference between the amount you received for selling the item and the amount you originally paid for the item.
Generally, you need to file if: Your income is over the filing requirement. You have over $400 in net earnings from self-employment (side jobs or other independent work)
eBay's fees vary based on the product category and the total sale amount. For most categories, the final value fee is 13.6% on the total sale up to $7,500 per item, with a 2.35% fee on the portion of the sale over $7,500.
Your transactions are online which means that they are completely trackable. And HMRC can access your selling records from eBay. So if you do go over £1,000, you're legally required to declare them!
Business or frequent seller (taxable)
If you regularly buy and resell items on eBay to make a profit, the IRS considers you a business seller. Business sellers must report all business income but can deduct related expenses. Business sellers may need to pay self-employment tax.
With a stolen SSN, criminals posing as you can:
Will locking my SSN protect me from identity theft? The answer here is pretty unsatisfying: It might. Locking your Social Security number can prevent employment identity theft or stop a criminal from collecting government benefits in your name. But it won't prevent all forms of ID theft.
Open bank accounts and credit cards in your name
Scammers can use your SSN and information to open bank accounts or apply for credit cards without your knowledge. These accounts can be used to take out loans or rack up massive debts—all under your name.
What is the maximum Social Security retirement benefit payable?