@Oscar222 wrote:
I received a 1099k from Paypal because I sold over 200 things on EBay. Most were for just a few dollars. Where do I report the income from these sales on my 1040? Then where do I report the expenses? Some of the money on the 1099k include what the customer paid me for the postage so my postage is an expense. These are all items that I sold from my home - like a garage sale.
Thanks!
If these are all items sold for less than their cost, you don't have to report the income at all. But, if audited, you will be expected to be able to prove that you sold the items for less than cost. Proof might include a written inventory of the items you sold, with the original cost and purchase date noted or estimated, and the selling price noted as less than the purchase price.
You can either leave the income off or add the 1099 in the "other income" section (not a schedule C) and then adding a negative item of other income to cancel it out with the reason "used items sold for less than basis" or something. Or, leave the 1099 off entirely, print your return and file by mail, and attach a copy of the 1099-K and a written explanation of why the money is not taxable (don't include the detailed proof-save that for later if asked.)
