Most of our customers buy small dollar amounts of our product (typically less than $500 at a time). However, we have one customer which typically buys $15,000.00 or more of our product at a time. During the course of a year, they may purchase $100K or more of our product (which they resell in retail stores). My question is, is this customer (the one who buys $100K+ from us) supposed to report these purchases to the IRS? Thanks for any help.
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Why do you care? You have to report the $100K of income whether or not your customer reports the purchase to the IRS.
-- Rich Carreiro snipped-for-privacy@animato.arlington.ma.us
No. But they will claim the purchases as inventory or cost of goods sold. But the source of the purchases is not identified.
Generally, no (the IRS would melt if every big transaction were reported to it); however, if they get audited the IRS will certainly see how much they paid you. Why does it matter?
Seth
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