Taxation using PP G&S

Depends on how much profit you make.  If you buy gear for $50k and sell it for $60k, you'll owe taxes on $10k, perhaps minus some expenses.  

If you sell it for $40K, you won't be able to write off the $10K loss unless you claim stereo selling is your business.  

But you won't owe any taxes if you lose money or sell at the same price you bought.

What most people want to avoid is the headache and the risk that that the IRS may ask difficult questions.  It is best to just avoid the need to deal with it.

Jerry

As noted by Jerry you won't pay tax if you have a loss, but you need to make sure that you have documentation - original purchase invoice and then your sale transaction documentation. You need to include the transaction on Form 8949 while filing your taxes. If a loss you put zero in the gain/loss column.

They have given you good guidance on the tax aspects. The practical aspects are a non-issue. It takes FAR less time to sell via G&S and the corresponding inquiries about why, than any potential burden of filling out an extra form. 
 

Think about the sheer volume of transactions that are legitimately being recorded as $0 profit. The IRS won’t have the time or inclination to look into your $2200 of G&S sales that didn’t provide net income. 
 

Who SHOULD be worried are those folks that are running businesses and taking all payments as F&F. My gut tells me that they are flagging themselves with (example) $500K of purchases over 500 transactions, and claiming that they are all non-income payments from their friends. 

No profit - no taxes. It’s just simple like that and confirmed with my CPA. 

Or just move up here to Canada and forget about the whole thing.

Thanks for all of the responses.  You guys are great.  Sounds like with the small time stuff I deal with there should be no problems.  

Regards