W-9 Form? Any indiviual seller deal with this before?

[badbilly27]

So I'm selling my Gateway 6400 Server to a college that responded to my ad. They want to buy my Gateway 6400 for $595 plus $42.00 shipping. However, they want me to fill out a w-9 form. I'm worried because if I fill it out their system will spit out a 1099 at the end of the year and nail me for taxes - to the tune of probably close to $120.

I'm an individual just selling an extra computer. Any advice on a workaround? Is my understanding accurate that I will get taxed on my sale? Anyone have experience selling product but being required to fill out a w-9. Help

 

[kranky]

Disclaimer: this is just my opinion.

I suspect they won't report the sale to the IRS (they have no reason to) but want a record of your SSN in case of an audit so they could prove it was a legitimate transaction. Since they aren't paying the money to a business, they might need to prove it was on the up-and-up.

But if it makes you uncomfortable, just decline and look for another buyer.

 

[Double Trouble]

I'll repeat kranky's 'disclaimer', I am not a tax attorney...

First, there is no federal sales tax, so you will not have to pay or charge sales tax. I don't know what state you're in, so I don't know what the tax laws are for your state, but assuming you are not a business and selling a personal item, you should not be charged any taxes. The only taxes that generally you'd have to worry about are capital gains taxes, which in this case are not an issue (unless you're selling the PC for a profit).

I would go ahead and sell the item to them without worrying about the taxes, you should be in the clear.

 

[badbilly27]

Thanks for the replies. You both are right. Since there is no capital gains I'm in the clear - just have a headache from a forms and payment perspective (need to ship it first). I'd recommend staying away from these selling situations as it's becomes more of a headache than it's worth.

Thanks again for the responses. You guys rock.