This advice is not across-the-board advice. You can't simply zero out every income that is received on Form 1099-K. You have to select the circumstance that applies to you.
There is no one answer to the 1099-K problem. Everyone's situation is a little different. However, if you fail to enter income of any type, other than what is expressly excluded, you will hear from the IRS. A very important aspect is whether you sell the item/s for a gain or a loss.
There are so many permutations to this. These are just some of the questions regarding 1099-K.
1) Some of the things I sold pertained to a business, but some did not.
You have to separate the sales that were actually business vs those that were not. You have a hybrid situation.
2) None was business income. I sold old things I had laying around the house. This is not a business. You must include the 1099-K but you can zero out the income since you had no profit.
3) I did this so it's kind of a business but not really. Yes. It's a business. Report on Schedule C.
4) I bought and resold but it was a one-off type of thing. You had a sporadic activity. It is other income.
The IRS simply states this.
What should I do with this information?
It is important that your business books and records reflect your business income, including any amounts that may be reported on Form 1099-K. You must report on your income tax return all income you receive from your business. In most cases, your business income will be in the form of cash, checks, and debit/credit card payments. Business income is generally referred to as gross receipts on income tax returns. Therefore, you should consider the amounts shown on Form 1099-K, along with all other amounts received, when calculating gross receipts for your income tax return.
1099-K
