New ebay payments require SS#?

Not for me, I'm OFF ebay!😢

Thanks to the OP for this post. I was not aware of this whole issue. Several other posts have excellent information and thanks to them as well.

As a former small business owner I can make a few points.

1. The issue is legitimate and it is not some sort of scam to get your SSN.
2. People who generate over $20,000 from eBay sales probably have a business. They may sell some or all of their stuff through eBay. Hopefully all of them file tax returns for their business. The 1099 will be one piece of paperwork in their tax return. It will need to match up with their other business records to protect them from getting into trouble if audited.
3. In any business you keep track of your cost of goods sold and deduct that from your gross revenue. They should know exactly what they paid for every item they sold on eBay.
4. If you are selling your own used gear, say several pieces that bring several thousand dollars each, you could trigger the 1099. You will need to know what you originally paid for the gear so you can show the IRS that you lost money on the transactions. There will be no income tax due because you didn't make any money. Now I can proudly say why I keep all of my receipts.
5. I can't speak for the IRS (but my wife used to work for them) - they have much bigger fish to fry than trying to tax a few dollars from audiophiles. I couldn't find where they have issued any rules about the new requirement but they will come. By the time you receive a 1099 from eBay and file your tax return there will be rules on how to handle it. The IRS is going to want to simplify this as much as possible.
6. Someone mentioned that eBay had asked for their banking password. Nobody needs your password to deposit money in your bank account or take money out of your account for direct monthly payments. DO NOT ever give your banking password to anybody for any reason. If someone actually asks for your password you are being scammed.
7. Regarding sales tax, if you live in a state that charges sales tax and you buy from eBay you are already paying it. That's one of the beauties of eBay - they take care of that automatically. It is transparent to the seller. If you don't like that then you should get politically involved and propose a different way to fund your state's government. Just because you buy something online doesn't give you the right to avoid sales tax.

As online sales take a bigger share of the retail market we will see our tax laws change to insure that these transactions are fully reported. Any honest business will already be reporting these sales in their tax return but I'm sure that there are thousands of small players who generate a significant income from eBay and don't report it.

It has probably been mentioned but you do not need to provide your banking password. It asks for it, as that is one way they can verify, but if you say no you simply enter in your bank acct # and routing info just like any other electronic payment. 

I'm not sure if it will now generate 1099s but as pretty much anything I sell on ebay is used and at a loss personally I do not care at all. 

@8th-note
Thanks for that helpful information.  One problem I see is that some people selling their used audio equipment may have owned the equipment for decades and have no idea where the original receipt is, nor may they remember exactly how much they paid for it.  They may even have paid cash for it, and no receipt was involved.  Some of this gear may be worth quite a bit of money, but why should they owe any income tax on it? 

Also, what about items that you inherited?  If you inherit an expensive piece of audio gear and have no use for it, why should you owe income tax on any sales proceeds from it?  And you would not have purchased it and received a receipt, either.

All online selling sites will be doing 1099s for yearly sales over $600...