Dear TurboTax,
Could you please advise on how to handle a 1099-K I received from PayPal? I live in Illinois and received a 1099-K for gross sales of just over $1,000. I saw that this includes even cancelled and fully refunded sales, and sales taxes collected by eBay -- all of which make the number much higher. Also, the 1099-K does not account for PayPal and eBay fees. I just sold personal items on eBay now and then, and many times, the cost of these items (i.e., what I paid for) exceeded what I sold them for. During Covid-19 times, eBay was my alternative to doing a garage sale.
Could you please advise on how to report this 1099-K in TurboTax Deluxe? And specifically address:
(1) Can I correct for the cancelled and refunded sales?
(2) Can I deduct ebay/PayPal fees? Can I deduct shipping costs?
(3) Can I deduct the cost of the items I sold?
(4) Do I need to provide anything to show the cost of the items I sold (i.e., do I need to gather and/or provide the sales receipts for every item to show what I paid for them)?
Based on the my perusal of the forums, all I can take away is that this may involve using "Less Common Income," and "Miscellaneous Income" in TurboTax Deluxe, but it's not clear and there seems to be no question-answer that directly address these questions for the infrequent eBay/PayPal users like me.
Could you please help? Thank you!
