The Steam Community Market is an virtual trading platform designed by Valve. It is used for trading game-specific items, trading cards, backgrounds and emoticons. It was released in May of 2013 alongside Steam's trading cards, and was expanded on on a later date.
Items are purchased in the Market via the Steam Wallet. Prices can range from $0.01 to $100.00, depending on the item attributes, rarity and demand. Users may also sell certain items in their Steam Inventory, albeit not all items may be put on the market. Valve also charges a "Steam Fee", which is 5% of the user's set item sell value, and in some cases, a "game-specific fee", which is determined by the game developer and is applied along with the Steam fee.
Users may put an item up for sale from their inventory if it is able to be sold. When prompted, the user may enter values into either of two boxes, "Buyer pays" and "You receive". These two boxes may be changed separately, but depend on each other. Users are able to see the mean sell value of the item, as well as what users are requesting sellers sell the item at.
When confirmed, the item will either be placed on a "market hold" or go on sale immediately. Market holds only occur if the user does not have Steam Guard enabled or has not had it enabled in the past 7 days. A market hold will last for up to 15 days before the item goes on sale. According to Valve, this is so that it will give a user more time to figure out if their account is compromised, and provides the user time to cancel any pending transactions that were not authorized by them.
Steam Transaction Fee
Steam charges a "Steam Transaction Fee" of 5% item value for every item sold on the Market. For example, if somebody sold an item for $100 on the Market, the buyer would have to pay $115 for the item. There also may be a "game-specific fee" for certain games, although this hasn't been seen apart from Valve-published games. This fee is placed at 10%, and stacks with the Steam Transaction Fee.
When a user hits either 200 market transactions or $20,000 worth, whichever happens first, Steam will bar access to the Market until the user fills out a tax information form. This does not apply to users not living in the United States. In the US, however, income will be reported to the IRS and further taxes must be payed as income tax, outside of the Market. The user will be issued a 1099-K.