I remember reading with eBay/PayPal sellers that eBay and/or PayPal would send a 1099-K to the IRS and user if there were more than $20,000 in sales in a year AND more than 200 transactions. Many unlucky sellers who did not claim their eBay/PayPal income would get letters from the IRS saying back taxes were owed on the entire amount of the 1099-K gross sales (with a large part of the amount owed being 15.3% Social Security + Medicare taxes), as if their cost of goods sold was zero. Then they would have to rebut the IRS's demand letter specifying cost of goods sold or else pay taxes on the full amount of gross sales as if it was all profit. Of course, this is rather crude of the IRS to assume the reported gross sales is pure profit, but the sellers in question failed to report any profit which is tax evasion.