bookkeeping Archives - Page 2 of 2

Categorize eBay transactions the way you want… plus more

Seller Ledger on April 5, 2023

Now that we have officially launched, it is time to get back to making the product better and easier to use. To do that, we’ve focused on a number of enhancements that came directly from our customers.

Customize how eBay transactions are categorized

First up, we heard from a number of people that they would like to be able to change how eBay data gets categorized when it comes in. As a refresher, here is how Seller Ledger handles eBay transactions by default.

But, we’ve heard some great reasons to change the default settings. Some examples include:

Putting eBay fees under the “Advertising” category rather than “Commissions and fees.”
Putting Shipping costs under “Cost of Goods Sold” instead of “Office Expense.” There’s an interesting debate here, which we plan to tackle in a future blog post.

However, one of the coolest ideas was to let customers have eBay order amounts go under a subcategory of Product Sales, so that, if you are a multi-channel seller, you could have a profit and loss that starts with something like this:

Categorize eBay transactions — Custom eBay sales categories

To make this possible, just go to our new “Customize” page under the Settings tab, and edit the transaction types you’d like to change:

Remember, if you want to use any sub-categories for eBay data, you’ll want to create those sub-categories first.

See your profit or loss by month, quarter or year

This one is pretty self explanatory:

On a related note, we also added totals to top right of the Income and Expense tabs, so when you drill down or filter for a specific date range and/or category, you can see the totals. This will also match the numbers your click from the profit and loss report.

Ability to delete sub-categories

A small enhancement, but for those of you who add a sub-category but then decide you don’t need it, or made a mistake, you can easily delete them. Of course, if you have categorized any transactions using that sub-category, you will need to re-categorize them. We won’t give you the option to delete a sub-category if there are any transactions using it.

That’s it for now. We’ve got a few other improvements coming soon, so stay tuned.

It’s Official: We’ve launched

Seller Ledger on March 31, 2023

Launch day! Seller Ledger has officially exited its “Beta” period and now offers automated bookkeeping software that’s specifically designed for online sellers.

First, a “thank you” to our Beta customers

There is no way we could have pulled this off without the help of more than 300 online sellers who took the time to bang on our software to find the bugs, the data discrepancies, and the things that just weren’t easy enough to use. Your commitment to helping, your patience with the flaws, and your continuous communication made this possible.

What does it mean to “launch?”

No, we’re not throwing some big event (though we can’t rule that out for future milestones:) Launching simply means we are at the point where we’re asking folks to pay to continue using Seller Ledger. It also means we’re committing to supporting the product going forward. We still have big plans for improving the product. In addition to adding new marketplaces like Etsy, Amazon and others, we will also continue to prioritize smaller improvements to make the product easier to use.

Do I have to pay now?

While we’d certainly appreciate it, we are giving all of our Beta customers the same 30-day trial period they would receive if they just signed up today. But they have the benefit of keeping all of the data already in their account (including transactions for the full 2022 year where available.)

Beta customers can see their paid plan options here: https://app.sellerledger.com/settings/billing

What does this mean for brand new users?

If you’re new to Seller Ledger, you can sign up for a free 30-day trial, import up to 90 days worth of sales and expense history from eBay, PayPal, banks and credit cards, and see for yourself how well the product eases your bookkeeping burden. We don’t ask for a credit card or any form of payment up-front. At the end of your trial, decide for yourself whether we’re providing enough value to pay for continued use. If the answer is no, that’s ok. We’ll just do our best to earn your business in the future.

Try for free

Thanks again to all of our Beta and future customers. Stay tuned for more improvements!

The Seller Ledger Team

Banks, credit cards and PayPal, oh my!

Seller Ledger on March 3, 2023

In one of our biggest steps toward building a great product (and filling the void left by GoDaddy Bookkeeping,) we are pleased to announce that Seller Ledger now lets you link most banks, credit cards, and even PayPal.

How to link banks, credit cards and PayPal

From your Dashboard, below your current connected account(s), simply click the “Add Connected Account” button and you will see an updated screen with a new option:

Click the button on the right side of the screen and follow the steps. Choose from the top banks listed, or search by name (which you will want to do for PayPal.) Once linked, we will pull in 90 days worth of transaction history for each linked account.

On a related note, we have also added some new categorization features. You will initially see a lot of transactions marked as “uncategorized.” We now make it super simple to choose a category and apply it to every other transaction like it – both in the past and future.

More than 90 days of history

Based on a handful of banks so far, it appears that we will be able to import the full prior year’s data in many cases. Not only that, but our cracker-jack development team has figured out a way to do the same for eBay data. We now have the ability to go back and get your prior year’s sales and expense history from connected accounts.

Updated pricing and a way of saying “thanks”

For those who may have noticed on our home page, we have updated our pricing section to reflect a couple of changes:

First, we plan to offer annual billing plans where customers pay for 10 months and get 2 free (we like round numbers and offering incentives.)

Second, every free trial will start with 90 days of transaction history. To receive more than 90 days, we will ask customers to commit to an annual plan. The reasons are twofold: one, that much data does increase our costs materially, and two, we’re excited to be able to deliver the full 2022 tax year, but it wouldn’t be fair if we allowed customers to receive this while only paying for a single month.

For those of you who have been with us on this journey to date, we decided that one way to say “thanks” was by going ahead and importing all of your 2022 data for you. Feel free to log in and view your 2022 sales and expenses. Thanks again for your support and wonderful feedback.

Help other sellers with 2022 taxes

Having read multiple discussions online (e.g. the eBay and Etsy community boards, and even Reddit,) there appear to be a lot of sellers who were left in the lurch when GoDaddy Bookkeeping shut down in mid-2022. While we can’t make this offer indefinitely, we wanted to let folks know that we’ll keep the free 2022 data imports going through the end of this month, until March 31. If you know anyone or have seen any calls for help in different communities, feel free to send them our way before the end of the month, and we’ll get their data back to Jan 1, 2022. Please let them know that we’re still in Beta, and we continue to work on improvements, but hopefully, we can help some of them out.

Again, please keep the feedback coming. And stay tuned for the next update.

Bookkeeping for Multiple eBay accounts

Seller Ledger on February 14, 2023

Seller Ledger now supports bookkeeping for sellers with multiple eBay accounts.

Based once again on feedback from our wonderful Beta customers, we have added the ability to link multiple eBay accounts to Seller Ledger. This is especially important if you are looking to match the 1099-K that eBay sends. If you have multiple eBay accounts under a single Tax ID, eBay combines the totals for all accounts under that Tax ID.

Learn more about 1099-Ks and why bookkeeping helps you avoid unwanted discrepancies.

Connect multiple eBay accounts in Seller Ledger

If you have multiple individual eBay accounts, it’s simple to link them with Seller Ledger.

Just add each account, one at a time, and watch them show up on your dashboard.

You can see each account, the net sales amount, and how many transactions have been imported. Click through to view the transactions within each account.

To make tax time much easier, we roll up your sales and expenses across all of your eBay accounts into a single Schedule C tax report.

Automated bookkeeping for eBay sellers just got a lot easier for sellers with multiple accounts.

As always, keep the feedback coming. We’ll see you at the next feature announcement.

1099-K threshold change delayed

Seller Ledger on February 9, 2023

Small online sellers who generate more than $600 a year in receipts get to breathe a sigh of relief…for one more year.

On December 22, 2022, the IRS delayed the implementation of the $600 threshold for payment platforms to provide 1099-Ks for online sellers. Instead of receiving 1099-Ks in early 2023 for the 2022 tax year, everything is being pushed back a full year.

For the 2022 tax year, the same thresholds of $20,000 in payments received from more than 200 transactions apply.

Get ready for next year

This delay in the 1099-K threshold change in no way absolves small online sellers of their tax obligations for the most recent year. But, it does give them another year to make sure the numbers they file on their Schedule C will match the 1099-Ks that get filed. Perhaps a new bookkeeping website for online sellers could help.

1099-Ks for Small Sellers

Seller Ledger on February 8, 2023

Last year, the IRS made a major change that will send a LOT more 1099-Ks to small online sellers.

Prior to this change, only sellers who had at least $20,000 in gross receipts across more than 200 transactions in a year would received a 1099-K. Some states have already lowered the threshold.

As part of the American Rescue Plan of 2021, this threshold was changed to a mere $600 per year. That means nearly all online sellers should expect to receive a 1099-K going forward. The change was originally intended to take effect for the 2022 tax year, but small sellers just got a slight reprieve as the IRS pushed back implementation by a year.

What’s the big deal?

Form 1099-K for online sellers — Should small online sellers dread the 1099-K?

The primary concern for many sellers is that a 1099-K means they will owe taxes on the amount reported in Box 1a (see the image above.) Sellers are also concerned about reporting the correct amount on Line 1 of their Schedule C (see image below) and matching that amount to their 1099-K.

Schedule C Line 1: Forss receipts or sales — It’s better when numbers match

Avoiding mismatched numbers

Here are some things that could cause differences and what you can do to avoid them:

Shipping

Box 1a of the 1099-K WILL include shipping amounts that you collect from the buyer. You should make sure that these amounts are also included in Line 1 of your Schedule C. Additionally, you’ll want to be sure you’re tracking and reporting all of your actual shipping costs as expenses.

Transaction Fees

Box 1a of the 1099-K WILL NOT include any fees that may have been taken out of your order (e.g. final value fees, transaction fees, etc.) This means the amount you actually receive in your bank account will be less than what gets reported to the IRS. Therefore, it’s very important to keep track of all of your selling fees and report them as expenses.

Refunds and Discounts

Like with fees, Box 1a WILL NOT include refunds and discounts. It is up to you to keep track of these separately, and place the total amount in Line 2 of your Schedule C tax form.

Multiple channels and multiple payment providers

It’s important to remember that each payment platform will be sending 1099-Ks to any sellers with more than $600 in annual transactions. If you sell on multiple channels, and they use different payment processors, you are likely to receive multiple 1099-Ks. In an ideal world, the sum of the 1099-K amounts should equal Line 1 on your Schedule C. However, this assumes that each payment platform treats all of these numbers the same. If anyone finds examples where this isn’t true, please shoot us an email and we’d be happy to dig into it and see what’s going on, then share with the broader community.

What about Sales Tax?

There seem to be many questions about whether sales tax should be included in Box 1a. Based on 1099-Ks shared with us by customers, and language from eBay’s help website, sales tax that is both collected and remitted for you will not be included.

Good bookkeeping makes this much easier to handle

While you can’t control what gets reported to the IRS, you can control what you file on your tax return. You can ensure the numbers in your tax return match what the IRS sees through good bookkeeping practices. If you are looking for help on that front, consider Seller Ledger, a bookkeeping program that’s specifically designed for online sellers. Seller Ledger’s automated solution breaks out those shipping, refund and fee details and make sure they roll up to the correct tax lines to match the 1099-K.

Disclaimer

The content in this page should not be construed as legal or tax advice. Please consult an attorney or tax professional regarding your specific tax situation.