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Question: Lending out Ebay/Paypal account and tax return/audit?

I have an ebay account that I lend to a friend of mine. He’s being really succesfull with the ebay business. My ebay account is linked to my paypal account. My friend transfer all the money he makes from my paypal account directly to HIS bank account. I asked him do I need to do taxes since it’s under my account n he said no because the money never touches my bank account and hes filing tax for it. However, I still feel uneasy about this because I’m goin to do my tax return soon and do not want to be in jeopardize of being audited.

Answer: A Paypal account is considered a bank account and it is a bank account tied to your social security number. In effect, you lent him your checkbook.

In a couple of years, Ebay/Paypal is going to be issuing 1099s for monies received and, the way it is now, that 1099 is going to be in your name.

I wouldn’t panic right now but you need to get him using his own account in the near future.

Your tax return: Don’t let guard down

New rules will better regulate tax preparers. But you still need to do your due diligence.

I’m an audit, I’m a tax return

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