I've now started asking buyers to use PayPal F&F or bank check, or even personal check (ships when cleared), not just because of the PayPal fees, but also because the new rules compel PayPal to generate a 1099 form, which complicates things enormously where I live. If it were only my federal/state tax return I had to worry about, it wouldn't be that big an issue because I can document the purchase price if the item compared to the price it sold for (usually half or less of retail). But in my city, they now require us to get a business license and pay tax on the GROSS income amount for any 1099 amount in excess of $600, calling this a home-based business. That's kind of the final straw for me.
PayPal Friends & Family listings. Why is this becoming so common?
I think most sellers now realize they are not going to have a taxable profit.
The F&F listings at market price don't seem to sell.
It seems like buyers demand around a 20% discount to take on the added risk of F&F.
I'm really just curious to hear what buyers & sellers think of this practice.