# Buying and reselling



## Plow Boy (Jan 1, 2004)

I'm finding out I do pretty good buying low at thrift stores, auctions, estate sales and every place they sell junk, ( I mean Treasures. ) and flipping these items at a higher price. My question is this.
I want to retire and start doing this from my home, on line and any place that will let me set up and sell. I will need the extra cash to help pay for health Insurance for my wife and me. I want to do it the right way by keeping records and paying all taxes due. 
I don't know where to start. I live in Indiana. Do I need a Indiana resale paper or something like I see hanging on the wall of all these junk shops. What is that called and how do I get one? 
Just one step at a time please..


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## MoonShadows (Jan 11, 2014)

How to Start a Small Business Indiana
http://www.ehow.com/how_2312993_start-small-business-indiana.html
http://www.powerhomebiz.com/resources/starting-business-indiana.htm
http://www.businessnation.com/library/business-resources/indiana-small-business/


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## clovis (May 13, 2002)

How much are you hoping to sell in a year's time?

Do you plan on collecting sales tax on your transactions?


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## Plow Boy (Jan 1, 2004)

clovis said:


> How much are you hoping to sell in a year's time?
> 
> Do you plan on collecting sales tax on your transactions?


 I'm hoping to sell as much as I can. But the way it's going, it's not much now. Hope to get it going better after I retire. I guess I will have to collect sales tax if the buyer is in Indiana. 
These things I want to learn more about. Who to charge sales tax to, the proper papers to get and everything else. I want to take it slow and learn the right way.
I have people say not to turn it in unless you make so much, other say to turn in everything. I have no problem reporting everything. If it's only a couple hundred a month, I have no problem reporting it, it's no big deal to me, I just get a high on buying low and watching people bid over junk (I mean treasures) that I post.


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## joebill (Mar 2, 2013)

Just a couple of remarks on that business.

First off, if you go legit, that means that you can deduct mileage from profits, and the last figure I can rememmber is around 50 cents per mile. Good reason to go legit. Lots of other deducations available, too.

Second remark;
The downside that can slip up on you is that you sell the stuff you DO sell at a very nice profit, but the stuff you buy and NEVER sell can eat up those profits. You have to take care that all your profits are not tied up in unsalable stuff that you have to store.

I have been buying old and rare books my entire adult life, and have sold a number of books that I paid anywhere from a half buck to ten dollars for, each book bringing me from $80 to $100, but all the profits are laying around on bookshelves in the form of books I have never sold or even tried to sell.

You can make money in the used stuff business, but you have to treat it like a business, not entertainment, like I do. Most dealers of used stuff have to make a few runds to the dump with full trucks every year, and that has to be reconed in to the profit and loss picture....Joe


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## clovis (May 13, 2002)

Are you wanting to open a retail shop, where customers can come in and buy stuff?


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## Plow Boy (Jan 1, 2004)

clovis said:


> Are you wanting to open a retail shop, where customers can come in and buy stuff?


Nope, on line mostly, ebay, craigslist, other sale sites I have. I can't see having a brick and mortar store and have to pay for heating, elect., insurance, rent or payments, upkeep and the list goes on. We live in the country in a small one horse dead town. I can post online and have millions of people see my things. 
In a town close to us, people try to open up thrift shops but they all close within a couple years. You have to sell a lot to keep a brick and mortar shop up and running. I have my building, my house.


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## clovis (May 13, 2002)

If you decide to start this business, and not just selling things around the house, you'll need to fill out and file a *Schedule C* or a *Schedule C-EZ*.

This is a form that you will fill out and send in with your Federal tax return.

At first glance, the Schedule C might make you dizzy, but in reality, it isn't that hard. The Schedule C is the form that figures out how much you made, deducts for your cost of goods sold, and allows for all of your deductions, like mileage, etc.

Just an FYI, you will be required to pay self employment tax on the earnings on the Schedule C, and you'll have to fill out a Schedule SE...I think that is what it is called. 

It really isn't that hard of a form to figure out. If I can do it, anyone can!


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## ldc (Oct 11, 2006)

FYI:the IRS mile rate this year is 56.5cents/mile.


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## joebill (Mar 2, 2013)

ldc said:


> FYI:the IRS mile rate this year is 56.5cents/mile.


yeah, I talk like I fill that stuff out myself, but DW has done it every year with NO interferance from me whatsoever. MUCH better that way....l.....Joe


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## Fire-Man (Apr 30, 2005)

Correct me if I am Wrong(do not Fuss), but if it were I----I would give all this a try for a few months, year then if I still wanted to get into it with all the paper-work, taxes, License etc. Go For It!

JFI----Opening a Mom and Pop Thrift store---Properly Run/set-up/location can put alot of cash in your pocket.


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## Plow Boy (Jan 1, 2004)

I'm getting ready to get my Federal & State Sales Tax ID Number. The State said I really don't need the Federal number but it would help having it for deductions at the end of the year for tax purpose. I am using my house as my office because all my sales will be on-line, Ebay, Craigslist and many other sale sites I am in. Your opinion on the Fed. tax number. I'm nothing big, just buy and resale.


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## clovis (May 13, 2002)

You don't really need a Federal tax ID number if you are starting a DBA or sole proprietorship.

You can use your SSI for your Schedule C on your federal return.

Let me caution you on this: Do *NOT* miss a sales tax filing. They might set you up on an annual filing, but will most likely move you to a monthly. That means that 12 times a year, you'll be filing a return with the state. If you miss many filings, you are asking for a pile of mess. This is NOT something you want to jack around with.

BTW, according to state law, you are supposed to charge sales tax on everything you sell. If you buy a tiller for $15, and throw it in the front yard for $75, you are going to be required to collect the sales tax and remit it to the state.


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## MichaelZ (May 21, 2013)

With respect to taxes, Turbotax can guide you through this nicely.


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## Plow Boy (Jan 1, 2004)

Can you block a certain State from buying or bidding on your idem on ebay?


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## MikePote (Feb 24, 2014)

A friend and I did this for about a year to make extra income while unemployed when everything hit the crapper in late 2009. Not pertaining to your question but a great tip is to check out auctions from business liquidations. We followed an auction company that did restaurant closings and a bunch of industrial auctions. At the end of the restaurant auctions they sell off the random advertising and signs (beer, spirits, neons, patio umbrellas, coasters, tap handles). The people at the auction will own bars and restaurants and have no interest in stuff like this, plus by the end of the auction you only have half the crowd. It was not uncommon to pick op 20 or 30 beer signs for a buck or two each and flip them for 20 or 30 bucks each depending on what they were. We did the best on beer signs and tap handles. At the end of industrial auctions they typically go through the offices and breakrooms. Desks, tables, chairs, coffee makers, file cabinets can be had for cheap. We had the advantage of living in suburban Chicago in a terrible recession so the opportunities were abundant. We tried the same thing many times at the auction houses and never made a dime but business auctions were always good to us.


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## Maura (Jun 6, 2004)

It would help if you became an expert on what you are selling. Mike Pote discovered he could buy signs for $1 or $2 and resell at $20 or $30. If you are always looking for what people want, you will always have something, and people will keep coming back to you. Once you have some sort of client list, whether from ebay, C's list or the newspaper, you can send off a quick memo telling them you have more of the same. If you are collecting office supplies, you can get a list of new businesses (new 'doing business as') from the county and send them a letter outlining what you have that they may be interested in. Regardless of the economy, people are always starting new businesses and most of them are interested in saving a buck because they are just starting out.


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