Sellers have indicated eBay does not provide a way for them to easily find and print sales tax information needed when filing their business taxes in April. eBay is required to collect sales tax from buyers located in certain states, but the tax it collects will be included in the totals on sellers' Form 1099-K provided to the IRS.
To get an idea of how unwieldy the process is, check out a workaround an EcommerceBytes reader described in order to obtain the necessary information.
The reader posted the information in the comments section of the EcommerceBytes Blog post titled, "eBay Ask Me Anything Reveals Core Seller Concerns" in response to a section about eBay sales tax reporting.
"We need a 2019 Report Showing Sales Tax Paid for us by Ebay.
"Sellers that are using PayPal will have a problem completing their Federal income taxes this year. Larger sellers receive an IRS form 1099K from PayPal and it will have the sales tax recorded as income. We then need a corresponding report from eBay showing the sales tax paid so it can be deducted from the income.
"I have contacted everyone I know at eBay and they have all agreed it is a problem and eBay has no solution. We need a report from eBay, not PayPal, showing sales tax paid to satisfy the IRS requirements."
A reader responded by posting the following workaround in the comments section of the EcommerceBytes Blog
"Answer for sales tax on PayPal: If you call eBay or PayPal they will not have an answer for you but someone at PayPal was smart enough to add this to the PayPal reports. To do this go to PayPal, activity, create report. Select "All Transactions" then the dates you want. It seems that 11/4/19 is the start of when taxes showed up in PayPal instead of eBay. Once the report is downloaded into a csv file/excel sheet you can sort the "Type" column. All of the tax eBay has collected is listed under "Partner Fee". I just copied that info into a new excel sheet and totaled the column. =sum(H1:HX) Fill in X with the last row on your sheet. That is the total number you will need for taxes vs your PayPal 1099. Hope this helps someone out. Merry Christmas! PS. eBay needs to have this total number available so we can just print it out."
(We have not tested that suggested workaround, feel free to chime in with your thoughts and other questions and solutions.)
Note that the eBay executive responding to the Ask Me Anything questions did not address the issue, and we're not sure if eBay (or PayPal) is working to address this reporting deficiency prior to tax-filing season.
A related question
, also not addressed by eBay: "Why did you decide to stop showing the amount of sales tax that would be due in the listing?" ("The last thing a buyer wants to have is an additional fee that they were not expecting at the time of check out," the seller explained.)