For your eBay business selling vintage video games and collectibles, I'd recommend looking at 451120 - "Hobby, Toy, and Game Stores" since video games seem to be your primary focus. This code specifically covers retailers of video games and would be most accurate for your business. If you're selling a really mixed variety where no single category dominates, then 454110 - "Electronic Shopping and Mail-Order Houses" would be the safer general e-commerce option. The key is to track your sales by category for a month or two and see what makes up the majority of your revenue. That should guide your NAICS code selection. And don't worry too much - you can always update it as your business evolves! One tip: make sure you're keeping detailed records of your inventory costs and shipping expenses. These are often the biggest deductions for eBay sellers regardless of which NAICS code you choose.

Great question! I went through this exact same process last year when I started treating my eBay selling more seriously. For your situation selling vintage video games and collectibles, I'd definitely lean toward 451120 - "Hobby, Toy, and Game Stores" since video games seem to be your main focus. This code is specifically designed for businesses that sell games and hobby items, which sounds like a perfect fit. However, if your sales are really mixed across different categories without one clear winner, then 454110 - "Electronic Shopping and Mail-Order Houses" gives you more flexibility as a general e-commerce classification. One thing that helped me decide was looking at my sales data for the past few months and calculating what percentage came from each category. If 60%+ of your revenue is from video games, go with the hobby/game store code. If it's more evenly split, the general e-commerce code is safer. Also, don't stress too much about getting it "perfect" - the IRS cares more about accurate reporting of your income and expenses than having the absolutely perfect NAICS code. You can always adjust it next year if your business focus changes!

Consider the long-term perspective too! C Corps require a lot more ongoing compliance - board meetings, minutes, separate accounting systems, etc. If you incorporate in Delaware or Nevada to save on state taxes, you'll still need a registered agent in those states ($100-200/yr). Our investment group started as a C Corp in 2019 thinking we'd benefit from the lower tax rate, but we ended up converting to an LLC last year because the administrative burden and costs were eating into our returns. Plus when we did want to take some profits out, the double taxation was painful.

Another important consideration that hasn't been mentioned yet is the state-level implications. Many states don't conform to federal tax rules for business entities. For example, some states impose minimum franchise taxes on C Corps regardless of income, while others have different tax rates for pass-through entities. Also, if you're planning to trade options or futures, there are special rules under Section 1256 contracts that might affect your decision. These are marked-to-market annually and get preferential tax treatment (60% long-term, 40% short-term regardless of holding period) which could change the math significantly. One more thing - if you do go the LLC route and your trading becomes substantial, you might want to consider making an S Corp election for the LLC. This gives you the pass-through taxation benefits while potentially reducing self-employment taxes on any profits you take as distributions rather than salary (though you'd still need to pay yourself reasonable compensation). The key is really modeling out your specific situation with realistic projections rather than making the decision based on tax rates alone.

Honestly, for small donation amounts like you're talking about, I wouldn't stress too much. The standard deduction is $13,850 for single filers or $27,700 for married filing jointly for 2023 taxes (filing in 2024). Unless your total itemized deductions (including these donations plus mortgage interest, state taxes, etc.) exceed your standard deduction, you won't even use the donation deduction. Most people don't itemize anymore since the standard deduction increased a few years ago. Maybe calculate whether you'd even benefit from itemizing before worrying about the documentation?

Great point about checking whether you'd even benefit from itemizing! For tax year 2023, the standard deduction is indeed $13,850 for single filers and $27,700 for married filing jointly. @Fiona Sand - before worrying about the documentation issues, add up ALL your potential itemized deductions: state and local taxes (capped at $10,000), mortgage interest, medical expenses over 7.5% of your AGI, and charitable contributions. If that total doesn't exceed your standard deduction amount, then you'd take the standard deduction anyway and the charitable contribution documentation becomes a moot point. That said, if you do end up itemizing, you'll definitely need to remove those donations made through family members as they don't qualify under IRS rules. Only direct donations to qualified 501(c)(3) organizations with proper documentation can be claimed. It's always better to be conservative with deductions you can't properly document - the penalties and interest from an audit aren't worth the small tax savings from questionable deductions.

Great discussion here! As someone who went through this exact decision last year with my spouse's consulting business, I wanted to add a few practical tips that helped us figure out the best approach. First, don't forget about the QBI (Qualified Business Income) deduction - it's available regardless of filing status, but your combined income when filing jointly might affect the income thresholds where limitations kick in. For 2025, the phase-out starts at $383,900 for joint filers vs $191,950 for separate filers. Second, consider estimated tax payments. When filing jointly, you can use either spouse's income to cover the safe harbor rules for estimated taxes, which can make quarterly planning much easier with irregular business income. Finally, here's something that saved us money: filing jointly allowed us to bunch itemized deductions more effectively. We could time business expenses and personal deductions (like charitable contributions) in the same tax year to exceed the standard deduction threshold, then take the standard deduction in alternating years. This strategy doesn't work as well when filing separately due to the lower standard deduction amounts. Definitely run the numbers both ways, but in most cases the joint filing benefits outweigh the separate filing "safety" for business owners.

One aspect that hasn't been covered yet is how filing jointly vs. separately affects your ability to claim business losses. If your wife's business has a loss in any given year, filing jointly often provides better tax benefits since the business loss can offset your W-2 income more effectively. With married filing jointly, you have access to higher income thresholds before passive activity loss limitations kick in. The at-risk rules and passive activity rules can be more favorable when you're combining incomes on a joint return. Also worth noting - if your wife's business qualifies as a "small business" under Section 448 (generally under $27 million average gross receipts), filing jointly might help you stay under various thresholds that could require more complex accounting methods. The key is really running both scenarios with your actual numbers. Every couple's situation is different, but I've found that the math usually favors joint filing unless there are specific circumstances like income-based loan repayments or one spouse having significant liability concerns.

This is exactly the kind of situation where you want to be proactive rather than reactive. The IRS has gotten much better at data matching over the years, and property sales are one of the transactions they scrutinize most closely. Here's what I'd recommend: Start gathering your records now, even though you don't plan to sell until 2035. Request tax transcripts for 2017-2019 from the IRS while they're still available, and reconstruct your depreciation amounts. Calculate what your potential recapture liability would be so there are no surprises later. The "allowed or allowable" rule is particularly important to understand - you'll owe recapture tax on the depreciation you should have taken during those rental years, regardless of whether you actually claimed it. For a 2.5 year rental period, this could be a meaningful amount depending on your property value. Consider consulting with a tax professional who specializes in real estate to review your specific situation. They can help you understand exactly what records to keep and how to calculate the recapture when the time comes. Better to spend a few hundred dollars now on proper advice than potentially face thousands in penalties and interest later.

Thanks for starting this discussion - this is such an important topic that many people don't think about until it's too late! I'm dealing with a similar situation where I converted my primary residence to a rental for a few years and now I'm back living in it. One thing I want to emphasize is that the IRS computer systems have become incredibly sophisticated at matching data. When you eventually sell, they'll receive a 1099-S showing the sale price, and their systems can cross-reference that against your historical Schedule E filings to look for potential depreciation recapture situations. The key thing to remember is that depreciation recapture is calculated on the LESSER of: (1) the total depreciation you claimed (or should have claimed) during the rental period, or (2) the gain on the sale. So even if your property appreciates significantly by 2035, you're only paying recapture tax on that 2.5 years worth of depreciation, not the entire gain. My advice would be to create a simple spreadsheet now documenting your rental period dates, the property's basis when converted to rental, and the annual depreciation amounts. Even if you lose your tax returns, having this basic information will help you (or your tax preparer) reconstruct the numbers accurately when the time comes. The peace of mind is worth the small effort now!