The IRS treats most collectibles as an investment.
However, if sports card sales are your primary source of income, you may be better off treating the buying and selling of the cards as a business and filing a Schedule C with the IRS.
It's tricky because the IRS does not specifically include sports cards in their regulations regarding this income matter. They do define a collectible as any tangible personal property that the IRS determines is collectible. The examples they give in their guidance are:
- Works of art
- Rugs, furniture, or antiques
- Precious metals or gems
- Stamp or coins
- Alcoholic beverages, most notably whiskey and wine
So clearly sports cards do fit in as a collectible in the eyes of the IRS.
Schedule C filers in general meet the following:
- You are the sole proprietor and are responsible for all profits and losses.
- Selling your sports cards isn’t your primary job, but your sale of sports cards generates a regular source of income.
This doesn't apply if you only occasionally sell a card.
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