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Tom Wolverton


From:
Carpinteria, CA
Post  Posted 27 Jan 2017 11:20 am    
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I sold a musical instrument on consignment at a music store and the store claims the check they sent to me is income, so they are sending a 1099 to me and also reporting this to the IRS. Is this common practice?
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Brooks Montgomery


From:
Idaho, USA
Post  Posted 27 Jan 2017 11:51 am    
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They have a strict accountant who is covering their butt in case of an audit. I know that I'm dealing with a lot more 1099's than I used to.
Good name for a working man's band "The 1099's"
(The Ten-Ninety-Nines for you over the pond)
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Jim Cohen


From:
Philadelphia, PA
Post  Posted 27 Jan 2017 12:14 pm    
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I'm no CPA but I have never heard of giving someone a 1099 for sale of a physical object, only for services rendered. I believe one would be liable to pay tax on any profit made on the sale but that's all. So if you bought the item for $500 and sold it used for $300, there is no profit, only a loss (which can be counted against profits made elsewhere). I'd check this with an accountant if I were you. Maybe a Forumite CPA will come along here...
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Tom Wolverton


From:
Carpinteria, CA
Post  Posted 27 Jan 2017 2:37 pm    
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Thanks. I talked to the store. They backed down. Their accountant was being super conservative. They dropped the idea. Sheesh.

Great band name.
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Jim Cohen


From:
Philadelphia, PA
Post  Posted 27 Jan 2017 2:39 pm    
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+1
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Rich Upright


From:
Florida, USA
Post  Posted 27 Jan 2017 4:50 pm    
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I don't see how selling something you own can be considered income. Tell 'em to pound salt.
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Brooks Montgomery


From:
Idaho, USA
Post  Posted 27 Jan 2017 5:10 pm    
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Rich Upright wrote:
I don't see how selling something you own can be considered income. Tell 'em to pound salt.


It sucks, but if you deducted/depreciated the guitar on a prior tax year as a professional player on your taxes, then it'll be income. At least according to "those that must be obeyed ".

(cash is king!)
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Jeffery Self


From:
Spring City,Tennessee, USA
Post  Posted 9 Feb 2017 4:17 pm    
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Rich Upright wrote:
I don't see how selling something you own can be considered income. Tell 'em to pound salt.
Laughing Shocked Whoa! Laughing Laughing Rolling Eyes
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Donny Hinson

 

From:
Glen Burnie, Md. U.S.A.
Post  Posted 7 Mar 2017 8:19 am     Re: 1099 from a consignment
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Tom Wolverton wrote:
I sold a musical instrument on consignment at a music store and the store claims the check they sent to me is income, so they are sending a 1099 to me and also reporting this to the IRS. Is this common practice?


No, that's wrong, a 1099 form is not required for reporting sales income. If they sold an item for you, then technically, you should send them a 1099, because you are "the employer" - and you paid them a commission fee for their service.

Legally, you're required to report any profit you made as income...but most people don't - unless it's their business, or it's a lot of money. Winking
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