There's usually a low end limit of what is considered a "business". I don't see the IRS rolling people in the parking lot of Costco for bulk buying cookies to resell at fund raisers. Or swooping in on this forum for people selling mags for a profit. A single sale is generally not a "business".
Fund raisers are not-for-profit. Non profits are tax exempt.
Selling
personal items for profit is also not taxable, to a certain point. The IRS defines that point very clearly.
-They paid the sales tax (Wal-mart won't do re-sale exemption), so the sales tax is not an issue.
If they bought specifically to resell, and resell higher than they bought, they have to pay sales tax on the difference:
You buy for $100.00 and pay the total sales tax of 8% for $108.00. You sell for $200.00, you OWE the sales tax on the $92.00 profit, or $7.36.
-As long as they declare income on their tax return, tax paid. Just like anyone who sells anything on Ebay or this forum.
Income tax and sales tax are not the same thing. But yes, once over a certain amount (Not sure the exact minimum these days, but it ain't much; below $1,000), then you do have to declare it as income and pay state & federal income tax.
-Even if you are running a business you do not need a tax number if you're a sole proprietorship and don't have employee's. It's a reasonable guess the family of 8 is not a corporation. Or maybe they already filed their LLC. <-sarcasm.
You do if you're making a profit on goods. Labor is not taxable, but products are, no matter how small your business is.
Only the end user pays sales tax. If they resell it, the sales tax has already been paid. Used cars can have more than one user, so one tax paid per user. If they sell "used" ammo, then a second tax needs to be paid. Kind of hard to sell "used" ammo. I think we call that brass.
If you're reselling for profit, you're not the end user. WRT automobiles, the sales tax is paid by the buyer at the time of registration.
You really don't seem to understand the difference between making a profit on an item you sell and selling items for the express purpose of making profit. Sure, we've all managed to sell things for more than we paid at some point, but there is a big difference between selling an item you bought for personal use and making a little on the sale, and buying items
specifically to resell immediately for a profit. Don't believe me? Ask the IRS. And yes, sometimes you owe income taxes on items you resell at a profit; It's called capital gains tax. Sell a rental home you own, you owe taxes on the profit if you don't reinvest in another rental property in X amount of days.
You also need to distinguish between whining and recognizing that some of these people are breaking laws while trying to make a quick buck. I have plenty of ammo, no need to buy $80+ .22 LR bricks or $1,000 cases of 5.56mm here. I'm pretty much just sitting back and rolling my eyes at people who are paying these prices. I'm also laughing at those (especially businesses) who think that making obscene profits on a scarce commodity won't bite them in the derriere at a later time. We saw it in '08; I watched 2 local shops that profiteered shut their doors within a year of the market normalizing. People remembered who was trying to screw them, and never went back.
