Scrapping taxes / audits

Originally Posted by Mettler

Can I assume that I asked a silly question?

not at all



If I understand correctly, companies only need to report payouts for services rendered by other non-companies valued at over $600...So if you sold a yard 1k in scrap, shouldn't be an issue. If you did 1k worth of labor for them, you'll be getting a 1099*

*But I'm not an accountant and you should probably consult a professional

Originally Posted by IronPirate

not at all

If I understand correctly, companies only need to report payouts for services rendered by other non-companies valued at over $600...So if you sold a yard 1k in scrap, shouldn't be an issue. If you did 1k worth of labor for them, you'll be getting a 1099*

*But I'm not an accountant and you should probably consult a professional

I like your answer. If that is (was) true, I think it may be changing for 2012. I've read that on any scrap sale over $600, there will be a 1099 issued. Whether or not that document will include the seller's name, I don't know.

Originally Posted by Mettler

I like your answer. If that is (was) true, I think it may be changing for 2012. I've read that on any scrap sale over $600, there will be a 1099 issued. Whether or not that document will include the seller's name, I don't know.

Oh yeah - didn't think of the 1099k thing. The laws were changed at the last minute so I think you're wrong on the mandatory over $600 reporting, but again I'm no expert. I've only been following it with regard to paypal (which reports over 20k in transactions).

Originally Posted by easyrecycle

Fix for paypal...get another paypal account and switch them around.

I was thinking of that, but we spent so much this year on inventory and equipment, plus the 179 deduction for vehicles, I saved money declaring the income.

Just so you know I currently work at a scrap yard in Michigan and we are not legally bound to turn any information over to the government for tax purposes. It is up the individual to claim the extra income. I can tell you that the only customers of mine that do report the income are the ones that are registered with the state of Michigan as a scrap business. Not to mention if they do change the laws and require us to it won't be retroactive. Just thought I would share the rules here in Michigan. Not sure how the other states are.

Originally Posted by peeches1211

Just so you know I currently work at a scrap yard in Michigan and we are not legally bound to turn any information over to the government for tax purposes. It is up the individual to claim the extra income. I can tell you that the only customers of mine that do report the income are the ones that are registered with the state of Michigan as a scrap business. Not to mention if they do change the laws and require us to it won't be retroactive. Just thought I would share the rules here in Michigan. Not sure how the other states are.

When we got the mandatory ID at scrap yards law a couple of years ago (in Ohio), signs were posted that said explicitly that it was not for tax reporting.

It's really up to the individual to report.

I'd advise not having $100K in your bank account or any major purchases if you plan not to file.

You could be investigated as a drug dealer, terrorist, etc.

Not just a guy trying to make a living.

/2 cents