If you're running an Ebay business, it is awesome to have information at hand for easy tax filing. Rap with your tax professional about how to keep records for tax time. A CPA or bookkeeper is a lifesaver. It's smart to have everything ready when starting a business.

Keep your Ebay fees accounted for and deduct them as your income. Your internet access can also be deducted but it may not be the entire monthly amount.

Also the business use of your home can reel in some killer deductions. If you've set up a home office, no matter how small it is, you may be able to take the electricity and rent or mortgage off as a deduction. Your records don't have to be extravagant like corporation's, they just need to be right..Every time a purchase is made or you sell something, to include postage and shipping charges, record it.

Print our your reciepts to neatly file them away as diligently as a squirrel does acorns!

Keep your records organized.  Simply staple or clip your invoices and receipts together for each transaction and file them away in a folder for the month they occurred. Label the folder with the month and year so it is easy to find later.

The cost of the items (including listing fees and shipping) and the sale's amounts are subtracted to give you the amount of profit you gain. Being able to see the difference in the amount you've spent and the sale price will give you a leg up on seeing where you're spending too much and the ability to adjust accordingly to increase profits.

Just think of yourself as a self-employed person. You're running a small business. Therefore, you can take advantage of setting up a retirement account and other things offered to self employed individuals.

Making sure to pay the taxes you owe for your income made is powerful aspirin for the IRS migrane that you get every April!

For those of you who are filing as a single individual and the total amount of your income is less than the required filing amount, you do not have to file your taxes. The same applies to anyone who's filing jointly. It is still a great idea to keep accurate records just in case there is an audit. The IRS is a cakewalk when you're prepared!