When selling personal items, the income shouldn't normally be reported as self-employment or hobby income. Instead, it should be reported as the sale of personal items.
Here’s how you can enter the income from a 1099-K for personal item sales in TurboTax:
Follow these steps to enter your 1099-K using TurboTax Premium:
- Open or continue your return. Be sure you are signed in for the link in Step 2 to work.
- Go to 1099-K.
- Or In TurboTax, click search (magnifying glass icon, type "1099-K" in the search bar, press Enter, click the "Jump to 1099-K" link
- Follow the onscreen instructions to enter your 1099-K.
- Each gain or loss from a personal item sale needs to be reported separately. If you had a loss on the sale of any personal item, it can't cancel out any gain on the sale of another personal item.
- Example: Tyrone bought a couch for $400 and sold it two years later for $200. Since he sold it for less than his original purchase price, the loss can't offset other income, and the sale would be reported as $0 on his tax return. However, when Tyrone bought a table for $200 and sold it for $300 two years later, he had to report the $100 gain as taxable income.
