Sales Tax Pot of Gold

[Edsel]

As desperate as states are for revenue, why have they not subpoened records from EBay?  Of course, EBay is not liable for the taxes, but on nearly every transaction, someone would be liable.

I suspect some of my customers may be buying/selling on EBay and other online devices, and not reporting their income.  If the states raided EBay for sales tax revenue that would open up all transactions to the light of day.

[Lee B]

I think the state of Colorado won a court case several months ago that may have broken the logjam on this issue.

[SaraEA]

How about the income tax pot of gold from gambling proceeds?  Casinos etc don't report on W2G unless the win is over some fairly high amount--varies depending on the game, pot, amount bet--I never could figure it out.  Someone who wins $500 or even $1000 several times a year won't get a form and likely won't report anything.  Of course, most lose more than they ever win so it would be a wash for federal tax for those who itemize.  But many states don't allow itemized deductions so will tax gross winnings, most of which apparently don't get reported to them.  I think those high W2G limits were part of a deal the states worked out with casinos because they get a share of the house wins.  In this case, the taxpayer (or nonpayer) wins too.

The 1099ks are likewise set at pretty high limits.  Someone who sold one item for $15k would never get one.  Don't know who worked out that arrangement, but I suspect that some lobbyists made out like bandits.

 

[ILLMAS]

State of IL went after funeral homes for not itemizing the receipts, apparently some funeral homes were charging over $2K for clothing and accessories and they were not collecting sales tax.  

[Abby Normal]

I keep waiting for the personal property auditors to show up, now that we're expensing everything $2,500 or less. The form asks for expensed personal property but my clients never give me a list.