The 1099-K I recieved from my Credit Card Processor included my gross sales, including money I collected at Sales Tax for Arizona.
I have seen a few discussions about this, but I'm still looking for a definitive answer on how do I account for this on my taxes so I'm not paying taxes on the sales tax I collected.
Do I
1) Instead of entering in the amount on my 1099-k, I subtract the sales tax collected and enter that instead This seems the least correct, as what I put on my Schedule C as gross income will differ from my reported 1099-K, and would be an audit red flag.
2) In the section for expenses, specifically the Taxes section for deductions, include TPT collected there.
3) something different?
Supplementary question, the sales tax is collected all year long, but isn't remitted to the state until the following month. Do I still deduct December 2024's sales tax collected (since it isn't 'income'), but isn't paid to the state until January 2025?
Which one should I do?
Thanks in advance.
