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Thank you for your answer. This is what I was looking for. If you don't mind I have a few clarification questions. 

 

Because these websites will generate 1099k forms, when you say I do not  have to report it since they were all sold at a loss, I can just file normally and ignore the 1099k forms? And then if IRS has an audit, I show receipts and a breakdown of items sold? 

 

OR 

 

Since my main concern is triggering an audit because that gives me so much anxiety, I have sold things that I know were at a loss, but paper receipts most likely lost or thrown out from years ago. 

 

If ignoring the 1099k forms make me nervous, Do I file as Individual/self-employed (or Individual/Unemployed) and breakdown income earned and cost of goods to show a negative or 0 amount? 

 

Would it be this correct answer from the link you sent? >>

 

"However, when a Form 1099-K is issued, the IRS receives a copy, as well. The IRS will be looking for this income to be reported on your return.

 

Rather than wait for the IRS Notice, report the sale and the cost of that sale, as long as it does not create a loss by entering Form 1099-K as Less Common Income and entering the offsetting amount as negative income. This will in effect report -0-, but it does acknowledge the Form as issued, which will satisfy the IRS automatic search to match their records.

 

To do this in TurboTax, follow these steps:

  1. From the left menu, go to Federal and select the first tab, Wages & Income.
  2. Add more income by scrolling down to the last option, Less Common Income, and Show more.
  3. Scroll down to the last option, Miscellaneous Income, 1099-A, 1099-C and Start.
  4. Choose the last option, Other reportable income and Start and Yes.
  5. Enter the applicable description and amount and Continue
    • First, enter Form 1099-K as received. It is essential that the full amount be entered.
      • For a description, include Form 1099-K and Personal Property Sales if this is coming from personal items sold similar to selling items at a garage sale.
    • Next, enter an adjustment to reflect the cost of these items as an offsetting, negative amount up to the amount of the income.
      • For the cost description, include Form 1099-K and Cost of Personal Property 
      • In other words, if the goods cost you $100, but Form 1099-K was for $10 in sales, the maximum cost allowable would be $10."