You should be reporting the $1,000 as income and then $800 as an expense on Schedule C. Thus it nets to the $200 of taxable income for the labor and will match to any 1099Ks that you receive. This has ALWAYS been the correct way to file a Sch C ... so nothing has changed with the new 1099-K reporting requirements. All these parts you are "reimbursed" for can be entered on the Sch C as supplies thus you can skip the inventory section since these are not an inventory you carry.
