This is complicated. Confusion is to be expected. This is a complex task to report correct information accurately and completely. These thoughts guide us in giving suggestions.
- You want to report 1099-K income because the IRS is expecting to see the income reported on your Federal 1040 tax return.
- You should document fully what and why you are reporting what you report should a taxing authority ask questions several years later.
- You should only report the correct amount of income regardless of what is reported on the 1099-K forms. However, to accomplish this, you may have to 'reverse' an entry (or a portion of an entry) to accomplish this task. For instance, you sold something for $100 but paid $20 for the item = $80 profit. You should pay tax on the $80 profit not the $100 gross income.
How you accomplish all of this depends upon what kind of income is being reported on the 1099-K form. The steps are different for self-employment income versus hobby income versus other income, etc.
What kinds of income are you seeing on the 1099-K that you have received?
[Edited 2/2/2023 | 6:58 am PST]
@RJDPA
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