No matter if you’re thinking to start selling on Depop or you’re already selling on Depop, you should know that at some point in time, you need to provide a valid social security number (SSN) to Depop.
Now you might be wondering why does Depop need my SSN.
Well, in this blog, we will explain why you need to provide your SSN to Depop and if it’s safe to provide it. Moreover, we will discuss the consequences that you can face if you don’t provide a valid SSN.
So, without further ado, let’s begin!
Why Does Depop Need My SSN?
As a Depop seller, you might wonder why an online marketplace needs sensitive information like your social security number.
The primary reason is tax compliance and financial reporting requirements. Specifically, if your sales exceed $600, Depop must report this income to the Internal Revenue Service (IRS), making your SSN essential for accurate reporting.
Think of it this way: Depop acts as an intermediary between you, the seller, and the government. When you conduct business through their platform, they’re legally obligated to track and report your earnings. Your SSN serves as your unique identifier in this process, ensuring that your earnings are correctly attributed to you.
This requirement also benefits you directly. When Depop reports your income using your SSN, these earnings contribute to your Social Security benefits.
This means that your entrepreneurial efforts on Depop aren’t just generating immediate income – they’re also investing in your future retirement benefits. Every dollar of profit you earn and report properly adds to your lifetime earnings record with the Social Security Administration.
Suppose you sell vintage clothing throughout the year and generate $1,000 in sales. Come tax season, Depop will issue you a 1099 form reflecting these earnings.
However, you didn’t make a pure profit on these sales. If you spent $400 sourcing the items you sold, you can deduct these expenses on your tax return. This means you’ll only pay taxes on the $600 profit, not the full $1,000 in sales. So, providing your SSN to Depop will help in ensuring fair tax treatment.
Is It Safe to Give Your SSN to Depop?
While it’s good to be cautious about sharing your SSN online. You don’t have to worry about providing it to Depop as the platform has security measures in place to protect your sensitive information.
Depop uses encryption and secure data storage practices to safeguard your personal details. You should also remember that Depop is a legitimate, established platform that must comply with strict data protection regulations.
Moreover, Depop handles millions of transactions and has a vested interest in maintaining the security of its users’ information. They will use your SSN solely for required financial reporting and verification purposes, not for marketing or any other commercial activities.
Also Read: How Old Do You Have to Be to Sell on Depop?
What Will Happen If I Refuse to Give My SSN to Depop?
If you choose not to provide your SSN to Depop, then it will significantly impact your selling capabilities on the platform.
The consequences are quite straightforward: you won’t be able to receive payments for your sales. Moreover, Depop will restrict your ability to transfer money to your bank account by freezing your earnings.
In addition, Depop may implement additional restrictions on your account. This could include limiting your ability to list new items or even suspending your seller account until you complete the SSN verification process.
While this might seem harsh, it’s important to understand that Depop isn’t implementing these restrictions by choice – they’re required by law to collect this information for sellers who meet the earnings threshold.
Can I Use Someone Else’s SSN to Sell on Depop?
While it’s technically possible to use someone else’s SSN on Depop, doing so is strongly discouraged as it could lead to serious complications.
Using another person’s SSN creates a complex web of financial and legal responsibilities that can cause problems in taxation.
If you’re considering this option, remember that the person whose SSN you use will be legally responsible for reporting all income and expenses from your sales.
This means he’ll need to file self-employment taxes and maintain detailed records of all business transactions. Additionally, all banking and PayPal information must match the identity of the SSN holder.
The best thing is to use your own SSN when selling on Depop. This will ensure clean, accurate financial records and will prevent legal complications down the line.
Remember, proper documentation of your online selling activities not only keeps you in compliance with the law but also helps build your financial history and contribute to your future Social Security benefits.
