As a drop shipper, you don't really have any inventory. You have two options for reporting the cost of your items.
In TurboTax, you can report these costs in the inventory section as cost of goods sold and $0 for beginning and ending inventory, or in the expenses section as supplies.
Either way, you don't have to report inventory but you do need to carefully track what you paid for the products, materials, and supplies that go into the items you sell.
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