I bought a trinket for $700. Now it's only worth $650. I lost money on it, but am going to be taxed on it as income because it met an arbitrary threshold?
if you have proof of what you paid for it, you actually have a loss of $50, so no.
But let’s say you sell a couch to someone online for $1,200. As long as you can prove with a receipt that you originally paid more than $1,200 for that couch, that is not considered taxable income, Wilson says.
The tax reporting requirement started on 2012, though the threshold then was higher. A seller would only need to report income to the IRS if they had received $20,000 worth of payments per year and there were at least 200 transactions on their account. Starting in January, “the threshold is being reduced dramatically, from $20,000 to $600, with no minimum number of transactions,” Rosenthal says.
This updated reporting requirement is being confused with a separate proposal from the Biden Administration as part of a $3.5 trillion spending bill that is currently being debated ..Under the proposal, the IRS would review every bank account with a balance above $600 or with more than $600 worth of transactions in a year.